The 3 New Rules Of Recruitment In An Age Of AII

By Dave Winsborough, Forbes, August 16, 2024

The rise of Gen AI has increased volatility in a job market already roiled by covid and the great resignation. It is now driving two key trends. The first is that new jobs will become more complex. An Organization for Economic Co-operation and Development report showed that highly skilled jobs increased by 25% over the last 20 years and that before 2030 more than a billion jobs worldwide will be transformed. Second, organizations are shifting to skills-based hiring strategies and relying less on traditional signals of talent, like university degrees. In the U.S. for example, LinkedIn has seen a huge increase in job postings requiring skills instead of credentials. Skills-based hiring has the added benefit of providing a more diverse and deeper pool of workers (since data shows social class is comingled with elite degrees). 

What Are The Right Skills To Hire For?
Traditionally, organizations poorly specify how they define skills, but the most common distinction is simply hard vs soft skills. Hard skills are those related to fixed knowledge (‘I know how to . . . code an excel sheet’). The bad news is that because gen AI is built from the sum of all the knowledge humans have accumulated up until this point, hard skills are going to have a much shorter half-life. That means that urgently sourcing an excel guru last year was critical, this year it matters much less because ChatGPT can code better than 90% of humans.

Soft skills, on the other hand, which include components of our essential humanity like relationship building, persuasion (sales), team building and so on, now matter more than hard skills. McKinsey estimates the increase in the workplace demand for social and emotional skills will accelerate, as will the need for higher cognitive skills, such as creativity, critical thinking, decision making, and complex information processing. How much will demand increase in the next 5 years? By nearly 25%.

The shift towards skills-based hiring means that traditional markers of knowledge accumulation are no longer reliable pointers to future workplace success. Unless someone’s specialized knowledge puts them in the top 10% in their field, they are unlikely to be hired purely for expertise, and the evidence backs this up: employers serious about skills-based hiring are ignoring college credentials. LinkedIn has reported that 92% of managers believe soft skills matter as much or more than hard skills at work.

Seen this way, work that requires EQ is always going to need talented people because AI a) cannot do truly creative and original work and b) people always want connection and validation from other people.

Critically, soft skills are also the hallmarks of human potential, which is the one true competitive advantage in an environment where candidates may be faced with tasks they have never performed before. The potential is the option trade employers make between filling a role now against the likelihood of a candidate being an exceptional performer at some point in the future. By betting more on self-aware, resilient, smart, driven, curious, and socially skilled candidates smart firms increase the odds that new hires will perform in the long run, no matter the situation or the tasks.

The Three New Rules
Disruption in the employment market is here to stay. We know with certainty that manual, data entry and basic know-how tasks will decline, but no one can predict with confidence what future jobs are going to look like.  That suggests three fundamental rules to guide the way firms go about their hiring from now on:

Stop using traditional credentials (like degrees). Screening people based on proofs of accumulated knowledge, like resumes or the exclusivity of their alma mater won’t work as reliable predictors of potential anymore. Sticking to this approach means firms are fishing in a shallow talent pool.

Emphasize potential more than current attainment. Flexibility, learning agility, cognitive ability, and creativity can all be measured and predicted with some rigor by well-validated assessment tools. IQ turns out to be a better predictor of long-term success than college credentials. Scientific tools reduce bias and deepen the pool of candidates.

Focus on soft skills rather than hard skills. The half-life of hard skills is growing shorter.  Soft skills offer a better window into durable performance no matter the workplace or role.

It’s clear that traditional hiring practices are becoming obsolete and that navigating the recruitment landscape requires a mindset shift. The future of recruitment lies not in what candidates already know, but in their capacity to learn, adapt, and innovate in an ever-changing work environment. By focusing on potential rather than past credentials, emphasizing soft skills over hard skills, and abandoning outdated screening methods, organizations can build a workforce that can respond to challenges we haven’t yet foreseen. Those who look beyond college credentials, who value soft skills, and who look for potential in hiring candidates will be better positioned to attract and retain the talent needed to thrive in the AI-driven economy.

Other interesting articles pertaining to how best to hire and lead great candidates:

The biggest problem facing large companies right now is finding great talent—here’s what they need to do to win the labor wars (Fortune, August 16, 2024) 

You’ve Made It Big in Business–but Are You Actually Happy? (Inc., August 16, 2024) 

5 Things You Need to Consider Before You Hire More Staff (Entrepreneur, August 15, 2024) 

The Art Of Building A Stellar Team (Forbes, August 13, 2024)  

When a New Hire Feels Like They Weren’t Your First Choice (HBR, August 16, 2024) 

Why Leadership Teams Fail (HBR, September-October, 2024) 

New Rules for Teamwork (HBR, September-October 2024)  

Career Capital

Recent interesting articles pertaining to how best to manage one’s career:

Steve Jobs Said What Separates Successful People From Everyone Else Really Comes Down to 2 Words (Inc. August 20, 2024) 

Not Actively Looking? 3 Job Search Actions To Take Anyway (Forbes, August 19, 2024) 

How To Master Workplace Confidence In 3 Steps (Forbes, August 19, 2024) 

Warren Buffett Says True Success in Life Comes Down to Just 12 Key Decisions. Here’s Your Checklist (Inc., August 18, 2024) 

Why Is It So Hard to Find a Job in 2024? + Tips to Help You Beat the Odds (Ladders, August 13, 2024)  

5 Ways To Make A Positive Impression On Your First Day At A New Job (Forbes, August 12, 2024) 

Forget your résumé and cover letter. This is what actually gets you a job (Fast Company, August 8, 2024) 

This is what top CHROs say it takes to get hired in today’s cooling labor market (Fortune, August 7, 2024) 

Vacation Tips for Anxious Workaholics (WSJ, August 19, 2024) 

After a Pay Boom, Raises Are Shrinking (WSJ, August 8, 2024) 

The 10 biggest interview mistakes, according to hiring managers: You won’t ‘get that same level of grace anymore’ (CNBC, August 28, 2024) 

5 Things A Great Job Hunter Never Does In 2024 (Forbes, August 29, 2024) 

 

Mortgage Capital

Recent interesting articles pertaining to the mortgage industry:

Realtor.com Forecasts Mortgage Rate Relief By End Of 2024 (NMP, August 16 20204)  

Big Money, Big Changes (National Mortgage Professional, August 16, 2024) 

U.S. Foreclosure Activity Rises Amid Market Shifts (Mortgage Point, August 15, 2024) 

Mortgage execs on alert mode for lower rates — and their side effects (Housing Wire, August 6, 2024) 

Mortgage delinquencies rise in Q2 2024 (MPA, August 16, 2024) 

What impact will lower mortgage rates have on consumer sentiment? (MPA, August 16, 2024) 

IMBs Post Net Production Profits After Two-Year Slump (NMP, August 20, 2024) 

What the mild response to dipping rates could mean for the mortgage market (Scotsmans Guide, August 19, 2024)