Reason 1: Handling High Application Volume (The Tech “Arms Race”)#

The first reason is that it’s become too easy to apply for a job.

• Indeed has 60 million monthly users.
• LinkedIn has over 200 million.

Online job boards make it easy for applicants to apply for hundreds of jobs every day based on convenient filters that let them search results by industry, seniority, experience, and salary range.

Companies can get several thousand applications for a single position because the optimal job search strategy has become spamming your resume into as many positions that vaguely fit the description of the job you are looking for.

Companies have attempted to adapt to this by having landing pages where users can fill in their details into the company’s own database by manually completing an online form.

• These forms typically ask for information that should be included on any good resume.
• It enters it in a way that can be read by a computer instead of being read by a hiring manager, saving them the time of manually going through thousands of applications by hand to find the attributes they are looking for in a candidate.
• The back end of these forms will enable the hiring manager to search through their candidates by a similar set of filters that the candidates themselves used to find the job posting.

Even in the “arms race” between the volume of applications and the people that check those applications, “you’re quantifying human behavior, human Expressions, human voices, turning that into Data.” The narrative notes, “we’re now using artificial intelligence to help companies find the very best talent.”

Some companies have started using Application Tracking Systems (ATS), which use AI to scrape resumes for keywords to populate databases that can be filtered in the same way without requiring candidates to fill in a data entry form themselves. “and most likely you were being analyzed by an algorithm, how does that make you feel?” One response quoted is “I feel like that would Blindside me entirely.”

This practice has become so common that there are now AI tools like Zetti, Jobscan, and Rezi that check resumes against job posts and make sure that they are appealing to the AI system that checks resumes before the hiring manager does. So, an AI will write a resume to satisfy another AI to stand out against thousands of other applications also written and checked by AI.

Applying for a job has become easier than when you had to search the classifieds and call companies one at a time. But this means people can apply for more jobs. More applications mean that the acceptance rate at each job is much lower, and the best way to deal with this low acceptance rate is to apply for more jobs, which means that applying for a job has become harder all over again.

Nobody is to blame for this new paradigm. The creator loves making fun of dumb corporate decisions on this channel, but in this case, they are just reacting to new technology that has made finding applicants easier than ever, and everybody else is reacting to the same thing. The competitive “meta” of job searching has shifted from a firm handshake to mass spamming resumes to get past increasingly difficult spam filters.

But that’s just one reason, and there are plenty of things that companies are doing which are just dumb. So, it’s time to learn how Money Works to find out why entry-level jobs all of a sudden require three years experience and how you can take advantage of this benefit for your own career.

Reason 2: Risk Aversion (“Covering Their Ass” & Internal Hires)#

The second reason that companies have made it so difficult to apply for jobs is because they want to “cover their ass.” There are lots of reasons why a hiring manager might want to pick one job applicant over another, but not all of them are legal, and even if they don’t violate any equal opportunity laws, some might be a bad look for the company.

By listing lots of unreasonable job requirements, the company increases the likelihood that no applicant will tick every box, which means they can hire whomever they want and cover themselves by saying all of the other candidates were missing one or more of the role’s prerequisites.

It’s rare that companies get much pushback over rejecting an external candidate. Most people have just become accustomed to never hearing back from a majority of jobs they apply for. If you have ever applied for a job recently, you will know that “no response is the new rejection letter.” If companies do respond, they try to keep it as generic as possible so that they do not expose themselves to any potential unfair hiring practice lawsuits.

This makes a long list of job requirements somewhat redundant for external candidates. Where these do help companies, though, is in rejecting internal hires.

According to a study by Cornell University, internal hires outperformed outside hires, but only because they are more familiar with the business from day one, requiring less training to get into a new role, and because they were more likely to stay in a job longer than the outside hire. A similar study by McKinsey Consulting found that a strong culture of internal promotions helped with staff retention and encouraged staff to work harder to qualify because they could see it paying off for them.

The narrative mentions, “the pandemic a lot of companies are are not flush financially so they can’t afford to hire a new person.”

Internal promotions are effective, but they are also more difficult than outside hires.

• If you get promoted or moved around within your company, then someone else needs to be hired to fill your role.
• If someone gets promoted to fill your role, then HR has to fill three positions instead of just one, which is expensive, difficult, and triples the chance that someone won’t be able to perform their new job.
• People hired internally also don’t have probationary periods, so if they do underperform in their new role, they are harder to let go.

Internal hires have advantages, but external hires are easier and present less risk.

If a company has no strong internal candidates for a new role but doesn’t want to lose the benefits that come from occasionally promoting people from within, then the most effective strategy for them is to increase the job requirements so they can tell their existing staff that, unfortunately, they don’t qualify based on the job’s criteria.

Reason 3: Assessing Soft Skills#

And that’s a third reason why employers make job requirements that are so out of touch with the job they are offering: They want to see how applicants can deal with the challenge.

There is an old saying in business that even if you are not in sales, you are in sales. Most people do not have jobs that require cold calling a list of leads to generate revenue, but those soft skills are still important in every job.

Examples of relevant soft skills:

• Dealing with difficult customers.
• Dealing with difficult co-workers.
• Being able to present a strong argument.
• Simply showing empathy for a client’s needs.

These are all skills that could be demonstrated by an applicant when they are questioned about a shortcoming of their qualifications against the job requirements. If you’re in a job interview and can provide a strong response to a question like this that eases the interviewer’s concerns without disregarding them, you will probably end up doing better than someone who didn’t even have that experience gap. If you can deal with an interviewer’s concerns, then you have clearly demonstrated that you can deal with the other challenges as they are presented to you, a skill that is worth more than anything you can write down on a resume.

Reason 4: Managerial Bias Towards Experience#

And that’s the fourth reason. Some managers do know what makes a good hire, but most don’t. People are promoted into management positions based off having experience in a subordinate role. Managers are therefore naturally inclined to believe that when it comes to hiring someone, more experience is “more better.”

It’s a reasonable assumption that someone that has practice in a role should be better than someone with no practice. In fact, the creator notes they said it at the beginning of this video, and viewers probably just accepted it, but corporate rules to non-technical fields change so rapidly today that the benefit of past experience is negligible.

• A 30-year-old study conducted by the Internal Congress of Applied Psychology in Madrid found no strong correlation between experience and job performance.
• Since this study was published, follow-up studies, including a publication from the Harvard Business Review in 2019, found the same thing.

Most corporate managers do not read journal articles about statistical correlations between hiring parameters and job performance. Most go off their own experience, which validates their belief in the value of experience. They do the same for other job requirements because the safest move for them is to find a candidate that ticks the most boxes.

Experience can help a business, but so can new ideas, and neither is more valuable than the other. In fact, if it wasn’t for an enthusiastically inexperienced employee, Nintendo might still be a taxi company and proprietor of a love hotel. The creator states, “I’m not kidding, go watch my video over on How History Works to learn about the really weird 130-year history of Nintendo.”