Fun with Excel: Credentialism II

One of the arguments about credentials is that they signal ability. For various reasons, this is not entirely accurate. At this time, I don't want to dive into how credentials relate to signaling. Instead, I want to look at how reliable signaling can benefit businesses even if there is no impact on ability.


Once again, I have created a spreadsheet. I kept the same values I used in my last spreadsheet, but I replaced the schooling rating with a skill rating. The signal was kept simple. Anyone with a skill above 0.5 (50%) is flagged for being signaled. I also created a variable to randomly establish interest in a job that utilizes the skill. This latest spreadsheet can be found at: Credentialism II.xlsx

I put together a quick summary. I started by assuming that the 50 most interested in a job would submit applications. I then looked at the minimum, maximum, and average skill level within those 50. This was compared to the minimum, maximum, and average if the employer could simply throw away those without the signal. Simply put, the numbers look better when signals are taken into consideration.

I also took a slightly perspective on this one. Maybe a business doesn't want to look at 50 applications. Maybe they want to limit the number to ten. I compared the possibility of narrowing down based purely against interest to the possibility of the ten most interested with the signal. Again, the signals appear to have value to an employer without impacting skill levels.

In many ways, credentialism makes sense. Credentials can help businesses find employees that have needed abilities. Unfortunately, there are potential drawbacks that I intend to address in the future. Even in this spreadsheet, it's not ideal. We are not providing an accurate measure of skill, and capable individuals, including some with interest, are being filtered out.