What is skills-based hiring?

What is skills-based hiring?

Companies tend to hire people based on their credentials; their academic pedigree or years of experience in relevant roles. Not for their skills. HR experts at McKinsey think more companies need to adopt skills-based hiring.

Skills-based hiring explained

Skills-based hiring is exactly what it says on the tin. Here, recruiters look into the actual practical capabilities of the candidate, ignoring traditional qualifications such as academic performance and nominal work experience.

For instance, a software development company looking for a programmer will only look at the skills listed in an applicant’s resume. They may then validate the candidate’s skills through relevant problem-solving activities and exercises.

Why should you hire based on skill?

You would think that a thorough credentials-based hiring process will give you better chances at landing the best employee for the job; McKinsey argues otherwise. More specifically, they posit that skills remain a paramount requirement, and it is not important how the candidate learned them so long as they can do the job. Additionally, companies should give skills-based hiring a second look, mainly because of the following factors:

  • Conventional hiring makes it difficult to hire the right person. The old way of hiring is often defined by its tendency to require candidates to have a relevant college degree or educational attainment. This filters out the actual proficient applicants, unnecessarily turning away workers with the right set of skills.
  • There is an ongoing shortage of talent. Job Search International expects that last year’s dearth of talent will continue in 2024. Keeping traditional employment barriers such as college degrees will only make it more difficult for your company to find the right talent.

How can your company benefit from skills-based hiring?

Leaner skills-based hiring has now become a widespread phenomenon, with many companies shifting to this approach. This is all thanks to the following advantages:

  • Expanded talent pool
    Removing frivolous qualifications gives companies access to a broader candidate crowd. Removing educational requirements alone expands any recruiter’s options, allowing them to find the candidate best suited to the job more effectively.
  • Improved diversity
    Skills-based hiring practically ignores all qualities not related to the candidate’s skills, opening your company up to people of all orientations. A diverse workforce creates a dynamic, welcoming work environment and provides companies with many different perspectives that help their leaders come up with the best possible strategies and  decisions.
  • More efficient hiring
    Conventional hiring eventually filters candidates based on their skills. By skipping a few steps through skills-based hiring, companies get to shorten their recruitment processes and help them get the best candidate in the shortest possible time.

About Sam P

EnterpriseZone Staff Writer

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