What is skills-based hiring, and why is it good for you?

What is skills-based hiring?

Skills-based hiring focuses on matching job candidates to specific skills required in a role, rather than by a prerequisite degree or experience. For many years, employers would rule out candidates who didn’t have a college diploma for professional roles. That’s changing.

Christine, Director of Competitive People Intelligence with Fidelity, describes skills-based hiring this way:

“If there is an open role, [we try] to match a candidate based on their competencies rather than their reputation or their pedigree. We used to think that their credentials spoke to their ability to do the role. Now, skills-based hiring would be a different mindset where you’re thinking, ‘what are this person’s specific role-based skills, personality, and soft skills? What is their proven capability to perform the unique requirements of this role?'”

Why is skills-based hiring becoming so popular among recruiters?

Several forces have converged to create the need for skills-based hiring recently.

One is that technology is advancing so fast, educational institutions can’t keep up with workplace demands. In other words, the skills and competencies learned in a four-year-degree program may be replaced by AI or other automated systems in a matter of months.

New jobs emerge as quickly as old ones fade, and companies are often scrambling to find people to fill those roles. That forces them to look outside their traditional pool of candidates—to people without a degree or with non-traditional career paths. Some reports show that using a skills-based hiring strategy expands the candidate pool up to nine times more than traditional hiring practices.

Another reason recruiters have embraced skills-based hiring is the increasing number of people working as freelancers or entrepreneurs. When recruiters overlook people who took part in the gig economy or worked as solopreneurs over the last several years, they severely limit the number of candidates available to them for open positions. They would also miss out on the unique strengths these candidates possess because of their non-traditional work experience.

The skills-based hiring approach is a significant—and welcome—mindset shift that not only removes barriers to equity in hiring but takes a more holistic view of candidates.

Skills-based hiring promotes fairness and equity

As employers look beyond their traditional scope of candidates, they create a more diversified workforce. Some argue a diversified workforce is more resilient in the face of challenges and can weather economic disturbances better.

Christine says, “(If) we always hire from Harvard or CalTech, that can, because of systemic structures around who has access to those opportunities, …end up challenging some of [a company’s] goals around diversity and inclusion.”

Skill-based hiring is “a way to eliminate some of the systemic biases we may have.” One way companies are doing this is to forgo degree requirements for certain roles. Christine says this step is a simple move that helps companies staff key positions while creating more equity in the hiring process.

The skills-based hiring approach is a significant—and welcome—mindset shift that not only removes barriers to equity in hiring but takes a more holistic view of candidates.

Certain roles in particular benefit from this mindset—especially tech. Christine says, “There’s room for an expanded point of view about who [is] able to fill technical roles in different organizations.” It’s not wholly unusual for companies these days to hire someone without a tech background and train them in the kinds of skills needed in a particular role. This allows companies to tap into a broader pool of candidates, including new college grads, people returning to the workforce, or people working in service-oriented jobs.

Job seekers can gain transferrable skills in several ways outside of traditional degree programs or comparable experience.

Final thoughts

Skills-based hiring is a boon to both employers and employees. It gives employers a diverse pool of candidates to choose from and levels the playing field so workers have greater opportunities open to them.

If you want recruiters to take note of your skills, be sure to add them to your resume and any job search platforms you use. Update your profile and summary on LinkedIn, too. Recruiters are out there looking—help them find you!