More than 70 million workers in the U.S. don’t have a bachelor’s degree. Yet, between 2008 and 2017, over 70% of new job postings required one. This growing disconnect between skills and hiring requirements is a critical issue in today’s workforce, known as credentialism or the paper ceiling. In this blog, we’ll explore why this practice limits opportunities for many skilled workers, disproportionately impacts certain communities, and how organizations can move toward more inclusive, skills-based hiring practices with the help of tools like Moody At Work.
What is Credentialism and the Paper Ceiling?
Credentialism refers to the reliance on formal educational degrees as a gatekeeper for job eligibility, often at the expense of actual skills, experience, and job readiness. This “paper ceiling” acts similarly to the glass ceiling, but instead of gender or race, it blocks advancement due to a lack of specific academic credentials.
Many skilled workers acquire their expertise through alternative pathways including:
Military service
Apprenticeships and trade programs
Caregiving roles
Certificate programs
On-the-job learning and experience
Despite being fully capable and qualified, these workers face barriers because they lack a four-year degree.
Who Is Most Affected?
The impact of credentialism is not evenly distributed. It hits certain demographic groups particularly hard:
Black workers: 61% do not hold a bachelor’s degree
Hispanic workers: 55% are non-degree holders
Rural workers: 66% lack a four-year degree
Veterans: 62% are non-degreed skilled workers
Between 2000 and 2019, these groups lost access to 7.4 million jobs many of which once provided vital pathways to economic mobility and the middle class. Jobs like registered nurses, managers, and administrative assistants increasingly require degrees that these skilled workers don’t hold, despite their capabilities.
Legal and Compliance Risks of Strict Degree Requirements:
Beyond fairness and equity concerns, employers face legal risks when they require degrees without clear, job-related justification. Such practices may violate Title VII of the Civil Rights Act of 1964, which prohibits employment discrimination based on race, color, religion, sex, or national origin.
The Equal Employment Opportunity Commission (EEOC) and the Supreme Court have emphasized that policies causing a disparate impact adverse effects on protected groups—even if neutral on their face, can lead to legal liability. Unless employers can prove that a degree requirement is a business necessity directly tied to job performance, they risk violating anti-discrimination laws.
The Shift to Skills-Based Hiring and Workplace Equity
Fortunately, there is positive momentum. Skilled hiring is on the rise, marking a critical shift in how companies evaluate talent. By focusing on real skills and experience rather than formal credentials alone, organizations can:
Expand access to qualified candidates
Promote diversity and inclusion
Improve employee engagement and retention
Reduce legal risks associated with discriminatory hiring practices
This approach helps dismantle the paper ceiling, ensuring that all workers—regardless of degree status—have meaningful opportunities to contribute and advance.
How Moody At Work Supports Inclusive Workplace Culture
While Moody At Work does not assess degrees or credentials directly, it plays a valuable role in helping organizations focus on what truly matters: employee experience, performance, and culture.
By capturing anonymous mood and performance data across teams, Moody At Work provides leaders with actionable insights into employee engagement and workplace dynamics. This data-driven approach helps employers:
Identify high-performing and engaged employees, regardless of educational background
Understand team strengths and areas needing support
Foster a culture where contributions are recognized beyond just formal qualifications
In doing so, Moody At Work complements skills-based hiring strategies by ensuring workplaces retain and support diverse talent, ultimately boosting productivity and satisfaction.
Conclusion
Credentialism and the paper ceiling create unnecessary barriers for millions of skilled workers and carry legal and cultural risks for employers. Recognizing skills over degrees is not just a matter of fairness but a smart business practice that broadens talent pools and drives workplace success.
With skilled hiring on the rise, organizations have the opportunity to rethink outdated requirements and embrace tools like Moody At Work that help spotlight real contributions and employee wellbeing.
Breaking the paper ceiling starts with valuing skills, experience, and culture not just the degree on paper.
“Hidden workers” typically fall into one of three categories:
Missing Hours – Working part-time jobs while seeking full-time employment
Missing from Work – Unemployed long-term but actively job hunting
Missing from the Workforce – Not actively applying, but open to work under the right conditions
Many are caregivers, veterans, neurodivergent individuals, or those returning to work after illness or raising children. Their skills are real, but their profiles don’t fit neatly into traditional recruitment systems and that’s where the problem begins.
Why Hiring Systems Fail Them:
1. Automated Filtering Systems (ATS/RMS)
Modern applicant tracking systems (ATS) are designed for efficiency, not inclusion. They filter out resumes based on gaps in employment, lack of specific credentials, or nontraditional paths regardless of a person’s actual capability.
2. Overloaded Job Descriptions
Roles are often filled with “nice-to-haves” disguised as must-haves. The result? Talented individuals are disqualified on paper before they ever speak to a human.
3. Overreliance on Proxies
Degrees, company names, and job titles are still used as shorthand for competence. But they’re poor substitutes for skills, emotional intelligence, and work ethic especially in today’s evolving workplaces.
The Real Issue: Work Culture, Not Talent
The exclusion of hidden workers reveals a deeper organizational issue: work culture is still built on outdated metrics.
Talent is judged by pedigree, not potential
Grit is ignored if it comes with an employment gap
Soft skills are undervalued compared to technical credentials
Emotional health and wellbeing are rarely considered in hiring or team development
Companies may claim to prioritize diversity and inclusion, but their systems often do the opposite. And this isn’t just a hiring problem, it’s a culture problem.
The Cost of Overlooking Hidden Workers
By filtering out hidden workers, organizations are:
Missing out on diverse perspectives that foster innovation
Undermining team morale by reinforcing biases
Slowing progress on diversity, equity, and inclusion (DEI) goals
Reinforcing toxic work cultures that reward sameness over growth
This exclusionary loop affects retention, engagement, and performance and ultimately, the bottom line.
The Shift We Need: From Resumes to Readiness
To break the cycle, organizations need to evolve their understanding of performance, potential, and emotional readiness. This means building cultures where:
Leaders recognize growth beyond job titles
Teams prioritize emotional wellbeing and consistency
Hiring managers are emotionally intelligent, not just system-compliant
Peers are empowered to give meaningful feedback beyond job outputs
How Moody At Work Is Changing the Conversation:
Unlike platforms that focus on resume data or hiring funnels, Moody At Work focuses on building emotionally strong, self-aware, and connected teams from the inside out.
Here’s how:
🌱 Daily mood tracking and performance reflection help employees stay connected to their efforts, not just outcomes.
🧠 Emotional wellbeing metrics allow organizations to understand the health of their culture.
🙌 Peer-to-peer anonymous token feedback captures appreciation and recognition in real time.
📊 Quarterly reports help leaders identify what’s working — and what’s not — without invading employee privacy.
🎯 Strategy scoring guides admins in creating better work environments, fostering psychological safety and consistency.
Moody At Work doesn’t fix hiring systems — it helps make the people behind them more human.
By making your work culture more aware, balanced, and emotionally intelligent, you naturally build an organization that’s better equipped to recognize and support all kinds of talent.
What This Means for the Future of Work
A strong work culture is no longer a “nice to have.” It’s a competitive advantage. Inclusive hiring, emotional wellbeing, and team cohesion are the foundations of high-performing organizations.
To truly future-proof your workforce:
✅ Shift from exclusion to inclusion
✅ Replace rigid systems with flexible understanding
✅ Build emotionally intelligent teams — not just fast pipelines
Final Thought: Inclusion Starts With Awareness
If we want to stop losing out on the talent of 27 million people, we need to start inside with the teams making the decisions.
Moody At Work empowers those teams to build cultures rooted in consistency, humanity, and long-term performance and that’s what unlocks hidden potential.