Hiring 2.0: Why India Inc is prioritising skills over degrees

The electronics sector alone faces a 10 million-talent gap, while the semiconductor industry projects a shortfall of nearly 300,000 professionals by 2027, informs Nipun Sharma, chief executive officer of TeamLease Degree Apprenticeship.

While industries such as electronics manufacturing, semiconductors, automotive and health care are leading the demand for practical, job-ready talent, clients across pharma, BFSI and capital-intensive industries are also now hiring for demonstrated capabilities rather than degrees, says Sharma.

There is especially high demand for expertise in emerging technologies such as artificial intelligence (AI), machine learning (ML), data science and cybersecurity, as qualified professionals in these areas are in short supply, says Sonal Arora, country manager at GI Group Holding, a global HR solutions company.

“Given the limited availability of talent, many organisations are showing greater flexibility,” says Arora. “They are more willing to consider candidates with non-traditional educational backgrounds, or allied industry experience provided they demonstrate the required capabilities and potential.”

While this trend is especially noticeable in roles requiring technical or quasi-technical expertise—particularly in sectors like technology and engineering—experts say organisations are also exploring this approach for functional areas such as human resources, marketing and supply chain.

“The bottom line is that market demands evolve faster than traditional curriculum can adapt,” says Ankit Agarwala, managing director of recruitment services company PageGroup India. “With exceptions in FMCG, financial services and consulting industries, we’ve observed that Tier I college credentials are no longer considered essential for most roles.”

Talent solutions company NLB Services is also seeing a growing openness among clients in fintech and digital-first enterprises to hire candidates from non-traditional or non-degree backgrounds, provided they can demonstrate strong functional skills, says Sachin Alug, chief executive officer.

What’s changed is the weightage—hands-on capabilities, certifications and real-world problem-solving are now being valued over academic pedigree, he adds.

“Clients are increasingly asking us to build talent pipelines through boot camps and certification-led sourcing models, which reflects a deeper shift toward outcome-driven hiring rather than resume-driven screening,” Alug says.

Moving with the times

At Plum Benefits, a B2B startup in the health insurance and employee benefits space, it has always been about finding the right person for the role, regardless of background, says Priya Sunil, vice president-people success, Plum Benefits.

“Our founders don’t come from an insurance background, and some of our earliest and most successful salespeople come from fields like software as a service (SaaS), fintech and others, with most of the technical expertise learnt on the job,” says Sunil. “We typically look for attitude and proficiency in a candidate.” 

Some of these would include identifying and solving a core problem proactively, showing the capabilities to lead the function in the future, and the ability to thrive in ambiguity.

At IT company Happiest Minds Technologies, while the skills-first approach to hiring has been in practice since its inception, there has been a steady increase in candidates presenting industry-recognised certifications. “We see this as a welcome trend because certifications often reflect a strong commitment to continuous learning and staying aligned with evolving industry standards,” says Sachin Khurana, chief people officer.

“While we view certifications as a valuable part of a candidate’s profile, our hiring framework is anchored in strong skill-assessment criteria. What matters most is the ability to demonstrate relevant skills aligned with the role,” he adds.

M Lakshmanan, chief human resources officer at L&T Technology Services (LTTS), says at the engineering research and development organisation, they have not moved away from degrees, but beyond them. “Degrees are foundational, but skills are transformational,” he says.

Given the nature of the company, he explains that they continue to hire qualified core engineers because deep domain knowledge, systems understanding, and academic rigour are essential to the work they do.

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But, today, the nature of engineering itself has evolved and innovation lives at the intersection of core engineering and digital technologies like AI/ML, cloud, Internet of Things and cybersecurity.

“That’s where a skills-first mindset becomes critical. What differentiates talent at LTTS is not just their degree, but how effectively they adapt, specialise and apply their learning to solve real-world problems,” he says.

Like LTTS, consumer goods company Zydus Wellness also follows a contextual approach shaped by the role’s requirements, but a skills-first approach is a priority.

“What has shifted is the weightage of the degree in our decision-making process. It is no longer a gatekeeper but one of several indicators,” says Tarun Arora, chief executive officer and whole-time director.

He adds, “The shift was less about moving away from degrees and more about realigning with the pace of change. In an environment where consumer habits shift rapidly, digital disruption is constant and innovation cycles are shorter, traditional degrees no longer guarantee role-readiness.”

Enablers: Upskilling platforms

Upskilling platform upGrad has seen 1.6 lakh learners globally in the past year enrolled in its partner-led certifications and boot camps with India leading in the learner volume compared to the US, Canada, the UK and others. For its two-month-old U&AI certification course launched in partnership with Microsoft and the National Skill Development Corporation, the platform has recorded 35,000-plus sign-ups so far.

“Learners are increasingly opting for modular, high-impact certifications that deliver real-world outcomes,” says Anuj Vishwakarma, chief operating officer, upGrad.

Contrary to popular belief, Vishwakarma says the user base comprises not just freshers, but also early and mid-career professionals, along with leadership talent. This is because, “there’s a growing urgency to stay relevant, switch roles or lead in digital-first environments,” he explains.

The platform is also registering a strong intent from global enterprises and global capability centres in India which are partnering with them to power large-scale skilling internally. “AI today is a transformation enabler, and the skilling conversation has also evolved. It’s no longer about if employees need to upskill, but how fast they can do it and how contextual is upskilling to their roles,” he adds.

Arati Porwal, senior country head at CFA Institute, says India is the largest market for the chartered financial analyst certificate globally, reflecting strong demand for skilled finance professionals.

“We have seen several companies in India supporting their employees in gaining the CFA Charter, with additional time off to prepare, reimbursing or paying for their course/learning fee,” Porwal says. “Through our work, we have observed several employers prioritising qualifications such as the CFA Charter among fresh graduates and even using qualifications as filtration mechanisms while hiring.”

Not without challenges

According to TeamLease’s Sharma’s experience and observation, skills-first hires—particularly those who’ve undergone structured apprenticeships—often outperform traditional degree-holders on key metrics like retention, productivity and job adaptability.

For Khurana of Happiest Minds, a skills-based approach has resulted in visible and tangible results. He says that especially in areas such as UI/UX design and creative technology, several hires made purely on the strength of their portfolios and applied skills, without conventional academic degrees, have demonstrated a high degree of innovation, user-centric thinking, and delivery excellence.

Additionally, on an organisational level, he feels, this approach opens up the talent pool by creating equitable access.

However, while the shift towards a skills-first approach is gaining ground, companies are still grappling with key challenges in its implementation.

Sharma of TeamLease says many of these obstacles are rooted in systemic gaps in India’s education and skilling ecosystem.

“While the government’s recent Rs 60,000 crore investment to upgrade Industrial Training Institutes is commendable, foundational issues persist. Only 4 percent of the workforce has received formal vocational training, and a majority of skilling still occurs informally, without standardised outcomes or assessments,” says Sharma.

Another challenge is validating these skills because unlike degrees, which offer a standardised credential, skills must be assessed through more complex and customised methods—such as simulations, practical tests or work portfolios. “Many employers lack the tools and frameworks to do this at scale,” Sharma says.

And cultural biases remain.

“Degrees continue to be perceived as proxies for intelligence and employability, especially in legacy sectors and senior roles,” he adds.

Agrees Lakshmanan of LTTS.

“Implementing this model has not been without challenges. It required cultural shifts, robust frameworks for assessing skill proficiency and recalibrating expectations across our global delivery units.”

The head of sales at job search portal Indeed, Sashi Kumar, has observed the same. He says many organisations report that leadership teams require convincing, and hiring managers often need guidance on how to define and assess competencies without a degree proxy. Some leaders also worry about inconsistency in evaluation criteria, which can slow early recruiting cycles.

“However, these challenges tend to ease as standardised assessments and training frameworks take hold, and as confidence grows in non-degree benchmarks of candidate quality,” Kumar says.

For this approach to succeed, companies need to ensure that the right rubrics and processes are in place, reckons Sunil of Plum Benefits.

This means robust training of hiring managers, clear documentation on what the ideal candidate looks like, objective parameters and documentation during the interview process, she says.

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That said, while universal adoption will take time, for operational, technical and mid-level roles, Sharma of TeamLease foresees skills-first hiring becoming the default model by 2027.

Arora of GI Group also says skills-first hiring is here to stay.

“Staying current with emerging technologies, evolving skill sets, and industry best practices is now essential—not optional. Even candidates with traditional degrees will increasingly need to invest in continuous upskilling and certifications to remain relevant.”

For candidates, new and existing, adaptability is the most critical asset they can bring to the table, advises Prashasti Rastogi, director at upskilling platform Coursera for Campus and Government, India.

“Individuals entering the workforce should focus less on chasing job titles and more on building a tangible body of work—be it certifications, projects or prototypes that clearly demonstrate their capabilities,” she says. “Micro-credentials let you prove what you know, apply it fast, and stay in step with the future of work. It’s one of the most effective ways to stay relevant, stand out to employers and build real momentum in a fast-changing job market. That’s your edge.”