Tech employers count snobbery costs.

As tech employers continue to lament the skills shortage, a study published by education firm Wiley Edge once again demonstrates that hiring bias in favor of graduates is an approach that fails to find enough needed skills.

The survey found that 21% exclusively hired graduates from top universities, and 39% said they were more likely to hire graduates from top universities. A paltry 8% said they consider any type of higher education qualification. Possibly including BTEC and subsequent T-levels.

But at the same time, about a third (35%) of companies that consider all candidates equally say they have a hard time hiring new software engineers, compared to 62% of companies that focus their recruiting on more prestigious universities. Similarly, companies looking for an elite talent pool were 23% more likely to have difficulty hiring new data scientists and 28% more likely to have difficulty finding new cybersecurity professionals.

Calculating the cost of elitism

Costs come at several levels, as those looking for new tech workers are reluctant to walk down the corridors of elite universities when hiring. First, unfilled posts cost employers. Exactly how much money is difficult to calculate because there are so many inputs: money spent on recruiters, lost production, impact on bottom line, overtime to cover work, and underutilized assets. Impact on morale of existing team members, risk of burnout, impact on customer trust, and more. When a vacancy is in cybersecurity, the cost can be catastrophic.

Costs vary from employer to employer, but the long-term impact on overall economic growth in 2018 was estimated at £63 billion per year, something no one had ever heard of COVID-19 or The Great Resignation.

Employers who hire only graduates will incur another cost in the long run. A workforce without diversity tends to be more unhappy and runaway than its more diverse competitors. It costs money. However, a diverse team makes better decisions. A group of people with similar backgrounds and similar perspectives is much more likely to agree with one another than a more diverse group. Ideas are not tested, debates are not sharpened, and innovation is stifled.

Evidence has accumulated in recent years that diverse businesses are making better decisions, innovating more, and making more money than their homogeneous competitors. Evidence that groupthink can have dire consequences is abundant throughout human history.

Despite the outcry of those who loudly criticize what they define as the “diversity agenda” (see anti-woke), most tech employers can see which way the wind is blowing. Their clientele is more diverse, Gen Z is by far the most values-driven cohort, and their spending and hiring decisions are likely to be influenced by ethics as much as by financial considerations. Neither Gen Z nor the older cohort of millennials show any signs of becoming more socially, economically, or politically conservative as they age.

This is one of the driving forces behind the rise of collectively diverging profiles in a sector where ESG reporting and DEI messages can be summed up as “a lot of work, a lot of work to do”. They are definitely right in the second part.

These aren’t just graduates.

It seems like an outright statement to suggest that if companies want to fill vacancies quickly and increase the diversity of their workforce, they should spend some effort recruiting from a variety of geographies and agencies. Nonetheless, this study suggests it’s doing the exact opposite.

The more we look at the reliance on graduates to fill entry-level tech roles, the more we seem to be in the wrong place. The most obvious reason why technology is the focus of top universities is that we view technology as a badge of quality. These are not just alumni, they are Russell Group alumni. However, quality is not guaranteed.

Graduates from prestigious universities are more likely than the general public to have benefited from tailwinds such as private tutoring, cultural capital embodied by their parents, institutions that value them, confidence, and sophistication. Of course, many never had these advantages, and that doesn’t necessarily make them unsuitable for entry-level tech roles. The point is, fishing talent from these pools to the exclusion of all else isn’t necessarily a guaranteed path to top-notch candidates. Entrepreneurship, work ethic and raw potential can be found in many places if employers are willing to look for them.

speaking recent computing, Tony Lysak of The Software Institute explained why he advises tech companies to hire in their region. Not only does this allow you to source your technology at a more competitive price, but it also reduces long-term losses. Individuals are more likely to stay if they know they are given the opportunity.

Super high fliers may get poached or go elsewhere, but in most cases they’ll get their loyalty and longevity.”

Universities are working to improve diversity in admissions, but it’s a work in progress. Reliance on them for recruitment only perpetuates the lack of diversity in the tech workforce that nearly every employer openly laments.

Becs Roycroft, Senior Director, Wiley Edge, said:

“Many of the UK’s most traditionally prestigious universities appear to be making their own efforts to improve diversity, so it will be next to impossible for companies to improve the diversity of their technical junior staff by only accepting graduates from these institutions.

“To achieve greater diversity at the junior level, companies must actively work to widen their talent pool and encourage a wider range of people to make their roles known and supportive. It helps me overcome my recruiting challenges.”