Skills-based hiring: Find the right candidate for any role

What is skills-based hiring?

Simply put, skills-based hiring refers to hiring employees based on their skills rather than a college degree or specific experience requirement. Prioritizing candidates’ skills and talents over formal education casts a wider net than traditional recruiting practices. It focuses on more immediate skills and abilities by removing college degrees from job postings. Interestingly, a National Association of Colleges and Employers study found that almost two-thirds of employers use a skill-based strategy when filling entry-level roles. With its focus on talents and abilities, skills-based hiring contrasts with role-based hiring, which more often centers on education and traditional credentials.

Now that we better understand the specifics behind a skills-based approach to hiring, let’s explore how companies can actually put these principles into practice.

How does skills-based hiring work?

In the skills-based hiring process, job descriptions are rewritten to remove degrees for positions that no longer require them. Instead, candidates are assessed on what they can bring to the position. For example, your company might be seeking a candidate  for a customer service role in a call center who is outgoing, conversational, analytical, and friendly. These attributes might be more important to excel in this job than a degree in human resources or marketing.

Overall, job interviews are still structured and candidates are still measured based on key attributes. However, this hiring method is more about a candidate’s fit and less about possessing a specific degree or experience. Another example of a skill-based approach would be looking for outstanding communication abilities in a candidate for a newsroom position, rather than a degree in journalism.

Now let’s explore what successful organizations typically include when implementing this type of hiring structure.

Key components of skills-based hiring

These are three core aspects of skills-based hiring:

Competency-based job descriptions

Rather than leading with education and experience requirements, a skills-based job description might focus on soft skills, such as the ability to manage others or technical skills that will be built on the job. While it will still cover job scope and summary, a competency-based job description should also include needed skills, such as the ability to communicate well, problem-solve, and  be creative.

Skills assessments and evaluations

In addition to a traditional job interview, candidates might also go through a round of skills assessments and evaluations. Depending on the role you are hiring for, you could give a coding test or simulate a real-world sales experience to determine candidates’ skills and potential fit. Through this process, you can assess the potential hire’s ability to get the job done.

Reskilling and upskilling

Reskilling means that your job candidates are learning brand-new skills or taking on an entirely new role. Upskilling, on the other hand, focuses on expanding a candidate’s current skill set. Both are important for competency-based hiring. Ultimately, companies want to hire growth-minded individuals who are excited to learn new skills and expand their repertoire. In your company, if you are willing to reskill and upskill, you will open the door to a broader pool of appropriate candidates.

Next we’ll cover the potential pros and cons about skills-based hiring employers will want to be aware of.

Benefits of skills-based hiring

There are significant skills-based hiring benefits your business can take advantage of:

• Closing the skills gap: What skills is your team lacking right now? By evolving your hiring practices, you can close a skill gap and find strong candidates who are willing to grow with your business
• Enhancing diversity and inclusion: Diverse candidates may be less likely to have a college degree. When you want your workforce to represent the broader community, skills-based hiring can enhance diversity, inclusion, and encourage a wider range of problem solving.

Improving job fit and satisfaction: In the end, it makes sense to look for candidates who are a good fit for your job openings, even if they don’t check every single box on your list. Likewise, when you offer opportunities for career growth and professional development, you will also improve job satisfaction and staff retention.

Challenges and considerations

Naturally, there are certain things to keep in mind when it comes to skills-based hiring:

• The need to balance skills and experience: Unless you are willing to extensively train every new hire, you will need to balance skills with experience. For instance, if you are hiring for a more senior analyst position, you might find someone who doesn’t have quite as many years of experience as you want, but does have both a solid track record at a lower level and a desire to grow. In addition, you may also be interested in setting competency-based pay structures.
• A focus on aligning company culture with new hires: It’s important to ensure that your company culture welcomes new hires with different types of experience and interests. You may need to communicate your goals with skills-based hiring by instituting more training and education for both current and new employees.

We’ve covered a lot of ground, but before we wrap up, let’s touch on some ways that can help make this hiring strategy a success.

Implementing a skills-based hiring strategy

If you are ready to implement skills-based hiring, here are three tips to effectively launch this strategy:

1. Develop skills inventory and goals: Hiring still needs to be a standardized process. As you update job postings and hiring practices, make sure that you have goals and a skills inventory listed for each open position.
2. Train hiring managers: To follow this method, recruiters and hiring managers will need their own training and education. What should they look for in candidates? How will they know when they find a match? How will they report their findings? Make sure that they have the support and knowledge they need to make thoughtful hiring decisions.
3. Use AI and technology in recruitment: Technology can help sort through and organize the considerable array of skills you want to hire for. You can use AI to help build new job postings and scan applicants for specific traits and abilities. This can save your HR team significant time and money.

When it comes to job postings and interviews, skills-based hiring best practices center around organization and standardization, as well as having an open mind about skill sets and talents.