The tech recruitment ecosystem is stuck in the twentieth century. Can web3 technologies help employers find the digital skills they need to grow their businesses and the economy?
Among the abundance of articles proffering predictions for 2023, there's a common thread - the digital skills shortage. Despite some of the largest tech employers out there either quietly laying off a very small proportion of its workforce or noisily taking a metaphorical axe to more than half of the business, the talent shortage in the UK is real, pressing and preventing companies and the economy from growing.
The causes of the digital skills shortage are many and complex, and individual employers have no control over population level challenges such as declining birth rates or immigration policy. Where they do have some control is their own recruitment processes and, in most organisations, recruitment procedures are still stuck in the twentieth century. This is leading to distinctly suboptimal outcomes.
Firstly, the pace of recruitment is painfully slow, reliant as it is on long application processes, delays in fixing interview dates and long gaps between each stage. Referencing can also take a long time, is labour intensive, and suffers from the same problem as the whole concept of a CV - it's based on trust. The reason it is necessary is to verify information provided by candidates. Estimates vary as to how many candidates lie on their CVs but it's approximately somewhere between 30 and 50%.
Added to this long and expensive process is the fact that recruitment is built around the interview. Interviews effectively screen for cultural "fit," which is subject to very human biases, unconscious or otherwise. Reliance on interviews is part of the reason the tech sector remains so culturally homogenous. AI is being integrated into more HR platforms but it's highly intrusive and also subject to bias.
Perhaps the strongest indication that the process isn't working is the fact that up to 50% of new hires quit within the first 18 months.
If you were designing a recruitment ecosystem from scratch, the chances are it wouldn't look like this.
Web3 technologies have the potential to reimagine recruitment and help employers to recruit the skills they need to grow.
Web3 resolves the fundamental problem with the twentieth century recruitment model - the veracity of information provided by candidates. Blockchain for recruitment could be game changer: a tamper proof ledger that records every employee's working history and references. The problem of tracking down referees and getting them to respond to requests for references is gone.
Crucially, web3 could also provide the tools for employers to seek skills outside of the places they traditionally look. There is a consensus among tech recruiters that there are too many organisations fishing for talent in the same pool, and there simply aren't nearly enough computer science graduates to meet demand. Most employers are desperate to access talent elsewhere but don't know where to look. Blockchain specific job boards and platforms such as Discord and Reddit are options that the vast majority are failing to use but that wider web3 adoption would help.
Instead of posting job advertisements and hoping that the right people come forward or paying recruiters large sums to seek out candidates for them, employers would have instant access to a pool of verified people - and skills. This can scale in a way that the twentieth century recruitment model cannot.
It's easy to see how a web3 recruitment ecosystem would work for employers. What's in it for employees? Firstly, their data would remain theirs without the need to share it with platforms and providers. Secondly, potential employers can find potential employees more easily and neither employee or employer has to worry about the delays that a longwinded interview and referencing process introduces.
Richard Collins, Co-founder of the Smart CV provider CV Wallet explains how web3 has enabled employees to carry their CV safely on their phone.
"Thanks to blockchain and other web3 technologies (such as digital identities,) we've been able to develop CV Wallet and finally upgrade the traditional CV to a smart CV."
"We believe the future of hiring is skills-based recruitment, which has been almost impossible to date because the technology simply hasn't been there. CV Wallet is the first step towards our ambition of allowing employers to make direct offers to relevant, qualified, blockchain-verified candidates via a streamlined recruitment process."
A solution in search of a problem?
It's clear that web3 has the potential to force some drastic change on the traditional recruitment industry. It's also clear that a cloud of cynicism hovers over the concept of web3, not helped by the fact that this collection of technologies includes NFTs and cryptocurrency which hasn't exactly had a shining end to the year. Consumers are wary of the metaverse (quite understandably given the complete absence of regulation) and there are considerable doubts as to whether the decentralised ideal can ever fully emerge when there is next to no interoperability.
However, one of the more useful aspects of the metaverse is in training, and it's possible to see how objects like Smart CVs and virtual training can sit together within a web3 ecosystem.
There's another significant reason that web3 is more likely to succeed when applied to recruitment than in other areas, and that is that the present recruitment ecosystem isn't working. It is manifestly failing to deliver the skills needed to where they are needed. Cryptocurrency and certain aspects of the metaverse can be viewed as a solution in search of a problem. When it comes to recruitment that challenges are clear to all involved.
Richard Collins concludes: "How we hire is outdated and broken, but the advent of web3 technology finally offers us the chance to rethink the ecosystem in a way that's fit for today's world of work. Rather than just talk about it, we have built CV Wallet to demonstrate it working in practice and facilitate the positive changes that we believe such an ecosystem will bring."