The rise of skills-based hiring

Skills-based hiring has emerged in response to the evolving nature of work and the widening skills gap in the labour market. As the world of work evolves and transforms, the demand for new and complex skills is increasing, while talent shortages deepen. Skills-based hiring flips traditional recruitment methods by focussing on candidates’ actual abilities and by evaluating job applicants based on their relevant and transferable skills, regardless of their educational or professional background.

The benefits of skills-based hiring

Skills-based hiring offers numerous advantages for your business when looking to build a more capable, adaptable and diverse workforce to drive innovation and business success. By ensuring recruitment processes support skills-based hiring based on abilities and competencies, rather than traditional qualifications, your business can:

Find the best talent for your business needs, regardless of their background or experience. Skills-based hiring opens up a broader talent pool, allowing you to find capable candidates who might otherwise be overlooked due to their education or work history. This approach also enables you to attract a more diverse range of candidates, including career changers who bring valuable skills to the table.
Reduce hiring costs and time by eliminating unnecessary screening criteria and using more efficient assessment tools. Skills-based hiring can help your business save time and money by focusing on the skills that matter for the role, rather than on the credentials that might not.
Improve diversity and inclusion by reducing bias based on education, experience or other factors. Skills-based hiring can help your business create a more fair and inclusive hiring process by minimising the influence of factors that might be irrelevant or biased for the role.
Enhance employee retention and engagement by hiring candidates who are more adaptable, and aligned with your company culture and values. Skills-based hiring can help your business hire candidates who are more likely to stay and perform well in their roles because they have the skills to do the job, the motivation to learn and grow, and the fit with the company culture and values. Skills-based hiring can also support your business in creating a more positive and supportive work environment, where employees are valued and rewarded for their skills and achievements, rather than their credentials or resume.
Boost innovation and productivity by hiring candidates who have the skills to solve problems, learn new things, and collaborate with others. Skills-based hiring can also help your business foster a more innovative and productive work culture, where employees are encouraged and empowered to use their skills to create value and impact for your business and your customers.

Adopting skills-based hiring in the hiring process

Skills-based hiring is not a one-size-fits-all approach, but rather a flexible and adaptable framework that can be tailored to your roles, industry, and business goals. However, there are some general steps that your business can follow to implement skills-based hiring in their existing recruitment process:

Identify the essential skills and competencies for the role, based on the job description, your business goals, and the market trends. These may include technical, soft, or cross-functional skills, as well as the ability to adapt to industry changes
Evaluate and compare candidates based on their skills and competencies, rather than their education or work history. A structured and standardised evaluation process should be used to objectively and consistently assess candidates’ skills and competencies in line with the job description. It’s important to minimise the influence of irrelevant or biased factors, such as the prestige of a degree or the length of work experience, ensuring a fair comparison based solely on the skills that matter for the role.
Make final hiring decisions by focusing on the candidates with the most relevant and transferable skills for the role, regardless of their background or experience. A data-driven, evidence-based approach should guide the selection process, ensuring decisions are fully supported by an objective assessment of skills and competencies. Clearly communicate the selection criteria and decision-making process to candidates to maintain transparency.
Provide feedback and learning opportunities to candidates and employees to help them develop and improve their skills. Constructive and actionable feedback should be given based on performance, potential, strengths, and weaknesses. Additionally, offering learning and development opportunities such as training, mentoring, coaching, or career planning can help them acquire and enhance their skills and competencies.

Can outsourcing help?

By focusing on the skills and competencies that are relevant and transferable for the role, you can widen your talent pool, reduce bias, improve retention and engagement, and enhance performance and productivity.

However, implementing a skill-based hiring strategy can be challenging and time-consuming, especially if your business lacks the expertise to do so. This is where an RPO provider can help. An RPO provider can deliver end-to-end solutions for managing your entire recruitment process, from designing and conducting skills-based assessments to evaluating and comparing candidates based on their skills and competencies. They also offer feedback and development opportunities for both candidates and employees, while overseeing your selection and hiring process.

By partnering with an RPO provider, your business can leverage their experience and knowledge, and focus on their core activities, while ensuring that you’re hiring the best talent for your roles. Discover more about our Recruitment Process Outsourcing (RPO) solution here.

August 27, 2024