Redefining Merit: Steps to Build a More Inclusive Workforce

Note: This article is the first in a four-part series examining the four core principles behind SHRM’s BEAM Framework: merit as the primary lens, access over identity, continuous calibration, and operationalizing inclusion.

College degrees from highly ranked universities, tenure at prestigious companies, work histories free from resume gaps—these have long been prized measures of evaluating job candidates. However, assessing applicants’ conventional qualifications may not foster inclusion and diversity (I&D) in the workplace as effectively as blind evaluation metrics.  

In response to President Donald Trump’s executive order to remove diversity, equity, and inclusion (DEI) programs from the federal government, SHRM launched the BEAM Framework, a five-point test to ensure that policies and programs follow the rules but still support the principles of I&D.

SHRM Webcast: Diving Deeper into Affirmative Action and Federal Contractor Compliance: Key Insights & Critical Actions

The framework is based on four core principles, the first of which is “merit as the primary lens.” This refers to the idea of evaluating measurable skills and performance through skills-based assessments to remove biases and ensure decisions are based on genuine potential.  

“More often than not, what drives pure success is someone’s ability to take their qualifications and convert them into output,” said SHRM Chief Data and Insights Officer Alexander Alonso, Ph.D., SHRM-SCP, adding that focusing on merit helps set fair and inclusive qualifications.

Overcoming Barriers Stemming from Biases  

At its core, merit-based inclusion aims to create opportunities. However, biases against nontraditional education, resume gaps, or alternative experience often block access.

For example, consider that only about 42% of U.S. adults have at least a bachelor’s degree, including 27.6% of Black adults and 20.9% of Hispanics, according to 2023 U.S. Census Bureau data. Therefore, right off the bat, requiring a college degree eliminates more than half of all working adults, particularly those from many racial minority groups.  

“Creating a more inclusive economy is part of the reason for moving to skills-based hiring,” said Bryan Hancock, a partner at McKinsey & Company, in an October 2023 episode of the podcast McKinsey Talks Talent. “If you look at who has the skills but not the degrees, those are disproportionately people of color.”

I&D Prevails—but Only Through Action

At first, focusing on merit in I&D might seem to diminish efforts to support historically underrepresented groups. However, data paints a different picture.  

This is particularly true in the tech industry—which has struggled with diversity—where nearly half of tech employers (48%) surveyed by TestGorilla, a pre-employment assessment testing company, reported difficulty finding tech talent in 2024. In response, 88% of the tech companies surveyed now use skills-based hiring. Of these, 93% said it has improved diversity, and 84% of employees said they believe it reduces bias in hiring.

SHRM Foundation: Skills-First at Work

This approach only works, though, when employers shift from providing optics to pushing outcomes. Many companies have stopped requiring college degrees for some jobs, yet 2024 research from Harvard Business School and The Burning Glass Institute found this only increased nondegreed hires by 3.5%, or 97,000 out of 77 million annual hires.

“It’s not just as simple as saying that merit will get us to a point where people and organizations will be successful with I&D and greater diversity will happen,” Alonso said. “It takes redefining the qualifications for merit so then you can also ensure that historically underrepresented groups continue to gain access and have the opportunity to show that qualification.

Moving from Concept to Action

So, how can employers define the qualifications for merit? It takes effort—but the return on investment can be significant. HR professionals can adopt the following strategies:

When recruiting, ask hiring managers which skills are needed for the role. From there, search talent pools using those skills-based keywords. Add in searches for related skills, as well—ones that might not be essential for a candidate but could improve their success in the position.

“Merit will level the playing field back so that every group doesn't have an advantage based upon [I&D. They have it based upon true qualification.”—Alexander Alonso, Ph.D., SHRM-CP, SHRM Chief Data and Analytics Officer

Challenge traditional hiring beliefs (including your own). Not everyone will be immediately on board with overlooking higher education or years of experience. Collecting data on the benefits of skills-based hiring—such as longer tenure at companies, per 2023 research from Boston Consulting Group—can go a long way in reframing both your own recruiting mindset and others’.

Take advantage of artificial intelligence, which 29% of HR professionals said has increased the diversity of new hires, according to SHRM’s 2024 Talent Trends report. Practical tips for incorporating AI into HR practices include:

• Finding related skill keywords to boost searches.
• Developing assessments that mirror real-life workplace scenarios.
• Building clear job qualifications by which to measure applicants’ candidacy.
• Creating summaries based on conversation transcripts of initial interviews, which can then be compared against job qualifications and shared with the hiring manager and other stakeholders.

SHRM Webcast: Gender & Inclusion: Navigating New DEI Executive Orders

Empowering Inclusion Through Merit

Redefining merit through skills-based hiring presents a powerful opportunity to break down deep-seated biases and create truly inclusive workplaces. By taking action and using new hiring methods, companies can create fair and inclusive workplaces.

“Merit will level the playing field back so that every group doesn't have an advantage based upon [I&D],” Alonso said. “They have it based upon true qualification.”