More Signal, Less Noise: An Emerging Role for Digital Credentials in Hiring


Technologies intended to help companies expand their talent pipeline may actually have the opposite effect.
With data, improve the signal-to-noise ratio to help employers discover hidden talent in unconventional places.

Cast a bigger net for talent, and attract more applications. Attract more applicants, and increase the likelihood of identifying employees with the right skills. Online job boards and applicant tracking systems win. Skills gaps, in turn, shrink. Right? What could go wrong? 

If only it were that simple. In an ironic twist, technologies intended to help companies expand their talent pipeline may actually have the opposite effect. Because while online job postings and applicant tracking systems may result in more applicants per job, they’re also fueling the growth of resume spam and a maze of strategies employed by job seekers and “job hacking” sites that actually makes it harder to find qualified applicants.

As it turns out, today’s torrent of resumes doesn’t often equate with an increase in the number of qualified applicants.

Instead, it merely creates “noise” in the hiring process. In fact, HR leaders report that only about half of applicants even meet basic qualifications for the position. And screening more candidates—particularly those who are unqualified—increases costs for employers.    

In response, hiring managers have turned to crude proxies and increasingly restrictive filters (e.g., minimum educational requirements, years of experience, or specific search terms) to narrow their search. Even when a resume makes it in front of a human, the average recruiter spends only 6 seconds reading it. 

This creates a vicious cycle: high rejection rates encourage job hunters to view the application process as a numbers game, so they apply to even more jobs -- which only increases the cacophony for hiring managers, and exacerbates what has been characterized by some as a “costly, zero sum game.”

Improve the Signal-to-Noise Ratio

Digital credentials enable savvy employers to improve the signal-to-noise ratio by providing a much more precise description of knowledge, skills, and competencies in a data format that talent management and recruiting systems can easily consume and verify. Innovative providers of education and training are, in turn, partnering with employers to co-design credentials that meet the needs of the contemporary workforce. The result is an increased signal-to-noise ratio, with the potential to help employers unearth would-be employees and discover hidden talent in unconventional places.

Consider the case of the Colorado Community College System which has begun to map educational programs and courses to employer demands at a local or regional level. This involved breaking down academic progressions into specific component pieces to demonstrate more granular skills, adding precision to the language used to describe actual learning outcomes.

Initiatives like this reflect a growing understanding that while skills gaps are a major issue for employers, they are exacerbated by a communications gap, often rooted in employers’ ineffectiveness at explaining the skills required for success in a specific position, as well as failing to provide would-be employees with the chance to share what they know and can do outside of the formulaic boxes of today’s digital resumes.

Of course, closing the communications gap requires investments on both sides of the equation. Employers and education providers must work together to ensure the signals are accurate, clear, and verifiable. This means not only signaling the skills of job-seekers, but also improving signals from employers on what a job entails and what skills are required for success. This includes having employers create structured, dynamic job profiles with clearer signals at the competency and credentialing level. In this way, employers can push their preferred competency, skill, and credentialing language tied to in-demand jobs in ways that sync with signals sent from job-seekers and credentialing organizations.

As the use of digital credentials expands, job seekers will gain unprecedented insight into the link between what they learn and the sort of employment opportunities that exist in their community -- or around the country. And for employers, the improved signal-to-noise ratio means a higher percentage of qualified applicants for each job opening, and improved ability of hiring managers to identify the best candidates for their position.

Jason and Jonathan were part of an expert panel discussing this issue and solutions to creating stronger alignment between employers and institutions called Aligning Employers and Institutions with Digital Credentials on March 15, 2018.