What is Skills-Based Hiring (And How to Implement It in Your Recruitment Process)

Categories: Advice for HR Professionals

what is skills based hiring bannerFinding the right talent is crucial to your organization’s success, but let’s be honest—the process is often daunting. Unsurprisingly, 57% of recruiters anticipate challenges when hiring new employees in 2024. It underscores a common sentiment among businesses worldwide: recruitment is becoming progressively challenging.

In response, HR professionals use innovative tactics to streamline their hiring processes and reduce skill gaps. An emerging strategy is skills-based hiring, which diverges from traditional recruitment methods that primarily rely on resumes and experience. Let’s discuss what skills-based hiring is to help you integrate it into your recruitment operations.

What Is Skills-Based Hiring?

Skills-based hiring evaluates job applicants based on their demonstrated competencies relevant to the role rather than solely relying on employment histories, educational backgrounds, and other role-based indicators. Essentially, this strategy widens the search for potential candidates, giving those who do not fall under typical career trajectories a chance to vie for the position.

It has gained increasing support in recent years. According to a 2023 TestGorilla study, 70% of employers and employees agree that skills-based hiring drives better results than resumes. So, 73% began leveraging it in 2023—a significant increase from 56% in the previous year.

4 Benefits of Skills-Based Hiring

What does skills-based hiring bring to the table that makes it a better alternative to traditional hiring for your recruitment process?

1. Widens talent pool

Basing your hiring criteria on a candidate’s educational background or previous job titles may be limiting. But skills-based hiring casts a broader net since you’re also considering those who don’t follow conventional career paths yet possess the necessary competencies for the job. 

Suppose you’re hiring for a cybersecurity role; you may be better off filtering your search based on relevant certifications rather than a diploma in IT or computer science.

2. Decreases total hiring time

On a related note, access to more job applicants means you can speed up your hiring process and make more confident hiring decisions. You won’t have to lose money from lost productivity and revenue. Don’t simply take our word for it—82% of employers using skills-based hiring revealed that it significantly cut their time-to-hire.

3. Reduces hiring biases

Skills-based recruitment mitigates unconscious biases that can influence hiring decisions because it focuses on applicants with practical expertise rather than subjective factors. Even better, it helps build a more diverse and inclusive workforce that values candidates regardless of education, age, and cultural background.

4. Improves job fit

The prior benefits ensure that candidates align more closely with your vacancy’s requirements and expectations, with a higher likelihood of matching your workplace’s demands and culture. As a result, skills-based recruitment improves retention since employees are less likely to leave due to job mismatch and underperformance.

How to Implement Skills-Based Hiring in Your Recruitment Process

Skills-based hiring should permeate every stage of your recruitment process, from first contact to the final selection. Here’s how to incorporate it into your operations effectively.

Define the skills needed for each role

Identify the skills essential for success in the vacant role by collaborating with the department head and using industry standards as benchmarks.

Remember to consider both technical and soft skills. For instance, a software developer must be well-versed in relevant programming languages and capable of working with new and unfamiliar tech. However, they should also have well-developed problem-solving abilities and strict attention to detail. 

Revise job descriptions and advertisements

Your job listings are candidates’ first touchpoints with your brand, so revising them to reflect your focus on skills is crucial. Start by reframing job descriptions to emphasize outcomes and responsibilities over educational attainment and other traditional criteria. You could even state that a university degree isn’t a requirement as long as they possess the necessary expertise.

At the same time, avoid using jargon that might deter otherwise qualified candidates from applying. Remember, you want to hire skilled employees regardless of their knowledge of industry jargon.

Adopt skills-based assessment tools

Research assessment tools for the specific skills and competencies relevant to each role and integrate them into different stages of the recruitment process to filter the most suitable candidates. 

For example, facilitating a pre-employment test will narrow your applicant pool to those with the necessary skills for the job. They allow you to observe the candidate’s skills in action. If you’re hiring an IT helpdesk specialist, facilitating a troubleshooting test with controlled hardware or software problems is an excellent practice.

Structure interviews around skills

Interviews are crucial to any recruitment process, but some interviewers focus on simply repeating resume content. You can integrate skills-based hiring into discussions by creating targeted questions and scenarios to elicit responses demonstrating the candidate’s competencies.

Behavioral interviews are an excellent example; the situation-task-action-result (STAR) structure may help you visualize applicants’ ability to apply their skills in real-world situations. Furthermore, involve internal experts in the interview to gain specialized perspectives on candidates’ competencies.

Evaluate and adjust the process

Skills-based hiring should be an ongoing process with continuous evaluation and adjustment based on outcomes. So, after every interview, gather feedback from candidates and fellow recruiters on their experiences with the approach. You could seek input on the clarity of your job descriptions, the relevance of assessment tools, and the effectiveness of your interview questions.

Another way to determine your strategy’s effectiveness is to analyze your time-to-hire, retention rates, and other recruitment KPIs after implementation. Compare these metrics to previous hiring cycles to identify further areas for improvement.

Uncover Skilled Professionals with Manila Recruitment

Skills-based hiring has become a powerful solution to long-standing recruitment obstacles. It offers numerous benefits that increase your likelihood of finding top talent, but the challenge is implementation. Practice the strategies discussed to integrate this tactic into your hiring process and uncover skilled professionals to fill your roles.

That said, you don’t have to do it alone. Consider enlisting the expertise of Manila Recruitment, a leading recruitment agency in the Philippines, to streamline your hiring process and identify top talents tailored to your organization’s needs.

Contact us to learn more!

Arvin Ramos