Job openings that require formal education credentials are “gradually disappearing” this year on Indeed, the popular job search website said.
Over the same five-year period, the share of postings requiring at least some kind of formal education has fallen across nearly every schooling level, with postings requiring a bachelor’s degree or above seeing the sharpest job by 2.6 percentage points, the report suggested.
In addition, only 17.8 percent of U.S. jobs posted on Indeed required a four-year degree or higher, dropping from 20.4 percent in the past five years.
“While educational requirements are unlikely to vanish from job postings, growing support of skills-first hiring approaches is a clear sign for workers to invest in skills now, regardless of their education level,” Cory Stahle, an economist at the Indeed Hiring Lab, wrote in the report.
“In other words, even college-educated workers may have to think about re-skilling more going forward.” he added.
The labor market remains “tight”—meaning there are more job vacancies than unemployed workers willing and able to fill them, according to Mr. Stahle. For employers, this could mean that they may have to reflect on their hiring strategies and consider candidates who can demonstrate the required skills without necessarily having a degree.
“By implementing skills-first hiring practices where it makes sense, employers can attract high-quality candidates, compete in tight labor market sectors, and mitigate some of the demographic headwinds facing labor supply,” the economist advised.
When it comes to which roles skill-first hiring makes the most sense for, Indeed found that educational requirements have loosened in 41 of the 47 occupational sectors it analyzed during the past five years. This shift is more pronounced in some sectors than others, particularly in software development, project management, and tech-adjacent information design and documentation.
Jobs in science, technology, engineering, and mathematics (STEM) were among the sectors requiring the highest levels of education this January. For example, over 65 percent of industrial engineering jobs posted on Indeed explicitly preferred, if not required, a bachelor’s degree or higher.
In contrast, education requirements were lowest in sectors like driving (0.3 percent explicitly required or preferred a bachelor’s degree or higher), cleaning and sanitation (0.6 percent), and food preparation and service (1.3 percent).
There have been some ups and downs in college degree requirements over the last five years, Indeed noted. Interestingly, the website saw an uptick in bachelor’s and graduate degree requirements between 2020 and 2022 in 19 occupational sectors, especially knowledge-work fields such as accounting, architecture, and physicians and surgeons.
There could be many reasons behind the rise in educational requirements when the U.S. labor market was tightening, according to Indeed. One possible explanation points to COVID-19 pandemic-driven quits and early retirements, which forced employers to backfill roles vacated by experienced or educated professionals who retired or otherwise resigned.
“A sudden exodus of experienced and educated workers may have prompted a flood of backfill postings from employers seeking a close match to those workers who had recently departed,” Mr. Stahle stated, adding that the share of job postings requiring a college degree started to fall again in April 2022.
“It seems that the recent surge in public support for skills-first hiring and a shift in the types of workers being hired are the most probable drivers,” he wrote. “Even after adjusting for changes in job title-mix over time, there has been a noticeable increase in companies looking to hire workers with less formal education to fill their vacancies.”
The hiring trend described in Indeed’s report was also observed by LinkedIn, a popular business social networking website. According to an analysis published last August, almost 30 percent of paid job posts on LinkedIn in 2022 did not include professional degree requirements, up from 21 percent in 2019.
However, there remains the question of how many employers are translating the shift into actual hires. Greg Lewis, a senior content marketing manager at LinkedIn, noted that the percentage of degreeless hires made appeared to still fall short of the rate of degreeless jobs posted.
“Does dropping degree requirements actually translate into more hires of workers who don’t hold degrees? As we‘ll see, the answer for many industries and functions is ’no,‘” said Mr. Lewis. “While many have started to ’talk the talk’ of skills-first hiring, relatively few are managing to ‘walk the walk.’”
