7 benefits of skills-based hiring.

Heard the buzz about skills-based hiring and want to know how it could benefit your organization? We’ve rounded up the top reasons employers switch to skills-first recruitment practices.

The adoption of skills-based hiring is growing fast. According to TestGorilla's The State of Skills-Based Hiring 2023 report, 73 percent of companies in the US now use skills-based hiring, with 27 percent adopting this approach in the last 12 months. Also, 60 percent of companies plan to increase their spending on skills-based hiring, a significant rise from 39 percent in 2022.

So, could skills-based hiring be a game changer for your organization? With a skills-based approach, you can:

1. turn your talent pool into an ocean

With traditional hiring practices, employers wall out job candidates who don’t meet the job specifications, even though they may have all the necessary skills. Removing barriers to entry — whether it’s industry experience, an established network or the need for a bachelor’s degree — expands your talent pool. According to the United States Census Bureau, 37.9 percent of over-25s in the US have a bachelor’s degree or higher, so removing this requirement opens the door to the majority.

2. diversify your workforce

If you always send out the same job spec, over time you are likely to attract candidates from similar backgrounds. However, reducing or eliminating must-have requirements can help organizations become less homogenous. With skills-first hiring, you can build a more diverse workforce, bring in fresh perspectives and boost your company’s innovation.

3. take you to the STARs

Some employers who bemoan the talent shortage simply aren’t casting their nets wide enough. The nonprofit Opportunity@Work estimates that more than 70 million American adults are Skilled Through Alternative Routes. These STARs have acquired essential skills through community colleges, boot camps, military service and other pathways that don’t run through university. Consider investing in outreach programs to tap these unexplored talent pools.

4. future-proof your company

Ever-accelerating technological advances mean old hierarchies and traditional talent pipelines can quickly exceed their use-by date. Identify the skills most likely to be needed in the future using companywide processes like skill mapping. Then, feed the resulting data into your recruitment strategies to make them more flexible and forward-thinking.

5. help you find the best talent match

Employers want candidates who can succeed and thrive within their organizational culture, not just ones who look good on paper. Skills-first hiring helps you target skills you can’t get a degree for — collaboration, empathy and problem-solving, for example. This reduces the risk of a bad hire.

6. optimize the talent you already have

Dismantling traditional hiring frameworks for progression within your organization helps you make the most of your existing staff. Furthermore, a skills-based focus — combined with a culture of continuous learning — aims to close skills gaps and build a more agile workforce.

7. improve your retention rates

If you recruit someone whose skills are perfectly matched to the job, chances are they will be good at it, feel good about it and get more satisfaction from it. With employee turnover high in the U.S., this benefit seems more relevant than ever.

next steps for skills-based hiring

Ready to navigate the skills-based economy? Randstad can deliver reskilling and upskilling opportunities via our extensive ecosystem of strategic partnerships. After all, as the world's largest HR firm, we’re uniquely placed to provide advanced workforce solutions that can power the success of employees and employers alike.