One of Donald Trump’s loudest–and likely most impossible to fulfill – promises is to bring back coal jobs. He has made this appeal to people whose factory skills aren’t in demand anymore and likely don’t have the secondary education necessary to enter into other industries.
Whether or not more coal jobs are created, this need has started a conversation about labourers with different educational backgrounds. Silicon Valley should be a leader in this conversation. For years, the tech pipeline has been fed mostly from the same elite universities. This has created a feedback loop of talent and a largely homogenous workplace. As a result, tech continues to stumble when it comes to diversity.
The technology industry is now trying to figure out a way to attack its cultural and demographic homogeneity issues. One simple initiative is to begin to recruit talent from people outside of its preferred networks. One way is to extend their recruiting efforts to people who don’t have four-year degrees.
IBM’s head of talent organization, Sam Ladah, calls this sort of initiative a focus on “new-collar jobs.” The idea, he says, is to look toward different applicant pools to find new talent. “We consider them based on their skills,” he says, and don’t take into account their educational background. This includes applicants who didn’t get a four-year degree but have proven their technical knowledge in other ways. Some have technical certifications, and others have enrolled in other skills programs. “We’ve been very successful in hiring from [coding] bootcamps,” says Ladah.
When asked to name the most notable rags-to-riches entrepreneur that his firm has funded, venture capitalist Ben Horowitz doesn’t hesitate: Christian Gheorghe, a Romanian immigrant who came to the United States without speaking English, and rose from limo driver to founder of a business-analytics company, Tidemark.
It’s an impressive tale that encapsulates the way Silicon Valley likes to think of itself: a pure meritocracy; a place where talent rises to the top regardless of social class, educational pedigree, race, nationality or anything else.
Indeed, the notion that anyone with smarts, drive and a great idea can raise money and start a company is a central tenet of the Valley’s ethos.
Yet on close inspection, the evidence suggests that the keys to success in the start-up world are not much different than those of many other elite professions. A prestigious degree, a proven track record and personal connections to power-brokers are at least as important as a great idea. Scrappy unknowns with a suitcase and a dream are the exceptions, not the rule.
A Reuters analysis of the 88 Silicon Valley companies that received “Series A” funding from one of the five top Valley venture firms in 2011, 2012, or the first half of 2013 shows that 70 were founded by people who hailed from what could be described as the traditional Silicon Valley cohort. (For a related graph that shows the Reuters analysis, click here )
That means the founders had held a senior position at a big technology firm, worked at a well-connected smaller one, started a successful company already, or attended one of just three universities – Stanford, Harvard and Massachusetts Institute of Technology.
Unknowns from modest backgrounds, like Andreessen and Jobs, are relatively rare among today’s Valley start-ups. Much more typical are entrepreneurs such as Instagram co-founder Kevin Systrom, who followed a well-trod path from Stanford to Google to start-up glory.
Ross Levine, a professor at the Haas School of Business at the University of California, Berkeley, said entrepreneurs are more likely than salaried workers to come from high-earning, well-educated families.
As children, entrepreneurs lived in households where the average income in 1979 was $88,711, compared with $67,548 for the population as a whole, according to Levine’s study of the National Longitudinal Survey of Youth.
“Who’s going to be an entrepreneur?” he asks. “It’s going to be a rich person, to a much higher degree.”
So maybe the ‘new-collar jobs’ theory hasn’t quite filtered through to Silicon Valley. Surely it shouldn’t matter about your background and status if you’re capable of doing the job? It’s going to take a great deal of time to change what has become ‘the norm’ in this industry, but the feeling is that change needs to happen.