New report reveals the issues employers face with digital credentials
The adoption of digital credentials in recruitment remains limited for many employers amid challenges in interpreting them, according to new research.
Digital credentials, as defined by 1EdTech, refer to the verifiable, secure, and digital records of an employee's skills and achievements.
These digital records have been touted as a crucial element in the ongoing shift to skills-based hiring in workplaces.
But recent findings by 1EdTech show that this capability has yet to be maximised amid various challenges, leaving employers to fall back on traditional resumes when evaluating job candidates.
"The significant expansion of digital credentials, while theoretically offering clear, verifiable signals of skills and aligning with the push for validated skills and transparent learning outcomes, often fails to deliver in practice," the report read.
Interpretation is a problem for employers
1EdTech argues that this challenge is not because of the credentials, but because of employers' capacity in understanding them.
"Employers need clearer, more trustworthy ways to understand what an individual candidate can actually do," the report read.
"Too often, credentials do not clearly answer these questions. Credentials are also often issued at different levels – from individuals skill to full courses, programs, and degrees – adding complexity to the interpretation of skill information."
Some digital credentials are also often inconsistently structured, unevenly authored, or even overly generic despite containing valuable data such as skills, assessment criteria, and evidence.
"In short, trust signals are inconsistent, and credentials are difficult to compare across sources," the report read. "As a result, credentials are typically treated as supplemental, not primary, hiring inputs."
Addressing the problem
The findings indicate that changes have to be made in order for digital credentials to be widely used during recruitment.
"Employers are not necessarily asking for more data – they are asking for clearer, more interpretable, and more trustworthy signals of capability," the report read.
It underscored that digital credentials have to be well integrated into hiring workflows, stressing that making them accessible via links or external platforms makes them harder to use in recruitment, which is slowly prioritising speed and scale amid surging job applications.
"Currently, there is no incentive to take the extra time to access information is difficult to interpret, inconsistent across candidates, or not machine-readable, and therefore that valuable information is less likely to be used," the report read.
It stated that employers need information that is easy to compare, clearly aligned to industry or workforce-aligned skills, supported by evidence, transparent in how it was assessed, and credible.
"When these conditions are met, credentials can function as meaningful signals. When they are not, credentials remain peripheral," the report read.
