Employers are moving away from placing primary emphasis on education, certifications, and job titles. In contrast, skills-based hiring evaluates candidates based on their specific competencies. This approach looks beyond degrees, emphasizing the practical skills a candidate brings to the role—like having Adobe Creative Suite expertise without a graphic design degree. We are seeing a shift toward skills-based hiring, where employers are now prioritizing specific skills and relevant experience that will be most beneficial for the role they’re looking to fill. This skills-based hiring trend is set to redefine recruitment practices in 2025, with nearly two-thirds of employers utilizing it for their new, entry-level hires.
So, what does that mean—and why is this shift happening?
Many organizations are struggling to build effective teams while also struggling to keep up with the rapid technological changes across every industry. Reports show that 9 out of 10 leaders believe their organizations are currently experiencing skills gaps—or anticipate facing them within the next few years. These skills gaps stem from rapidly evolving job requirements as organizations try to keep up with technological advancements.
According to ADP, organizations that hire people based on their skills, rather than credentials, will see significant changes in their productivity. For example, 90% of organizations hiring based on skills report 90% fewer hiring mistakes, and 94% of skills-based hires outperform their credential-based counterparts.
Here are some benefits of skills-based hiring:
Expansion of job opportunities for non-degree holders. Education can open many doors, but often, a degree isn’t enough for job seekers to get and succeed in a new role. A skilled employee can offer more value than one who only has a degree or certification. Real world experience and expertise in their field prove to be more valuable to organizations.
Reduction in hiring costs and increased retention rates. Skills-based hires have what it takes to truly grow and excel in their role, which means your organization won’t constantly be re-filling a position every few months, which can be very expensive. This will also increase employee retention! Employees who feel valued and feel that they are making a positive impact on the organization are happier.
Creation of a more equitable workforce. Skills-based hiring helps level the playing field by shifting the focus from formal credentials to demonstrated abilities, giving talented candidates from different backgrounds equal access to opportunities they may have previously been excluded from. While they may not check the “traditional” box, their skills can set them apart. By valuing applicable experience and practical skills, organizations can build a workforce that better reflects a range of perspectives, backgrounds, and capabilities.
Recognizing skills-based hiring as the future of recruitment requires more than just acknowledging its value. Your organization must also adapt to verify that candidates have the necessary skills for the role and, at the same time, ensure your current team remains competitive in their careers.
How to Implement Skills-Based Hiring:
- Redefine job descriptions. Edit the list of requirements and duties to focus on the key skills and competencies needed to succeed in the role, rather than emphasizing the need for a degree, certification, or specific years of experience.
- Utilize skills assessments. Implement project-based evaluations, skills tests, case studies, etc., or ask to review previous examples of their accomplishments and projects. Remember, one test is not always a perfect indication of how well someone can do the job!
- Use AI to your advantage. Hiring platforms can now evaluate skills through assessments, scanning resumes, or simulations.
- Expand talent pipelines to consider candidates without a traditional background or experience.
- Train your hiring and recruiting team to know what skills to focus on instead of the credentials previously required.
How to Ensure Your Current Team Remains Competitive:
- Offer continuing education and professional development. Whether through a stipend for online courses, webinars, or conferences, give your team the opportunity to learn what’s trending in their industry.
- Identify skill gaps and provide training with reskilling and upskilling at the forefront.
- Encourage growth. Recognize and reward your team when they take the initiative to learn new skills or improve upon the ones they already have. There is no such thing as too much education, experience, or expertise.
- Provide leadership development to help mold your organization’s next generation of changemakers.
- Give the opportunity for your employees to learn from peers in different roles to gain broader expertise and a better understanding of your organization and industry.
- Offer opportunities for employees to transition into new roles based on skills rather than tenure, whether within their current department or into a new one. Employees that have the opportunity to move around are more likely to stay with the organization.
Conclusion
As the workplace and workforce continue to evolve, skills-based hiring is proving to be a game-changer for both employers and job seekers. Organizations that prioritize skills over traditional credentials are seeing better hires, reduced turnover, and a more agile workforce prepared for the inevitable future changes. By utilizing skills-based hiring practices and investing in ongoing development for current employees, your organization can build a more adaptable, competitive, dedicated, and engaged team.
It’s not too late to change your hiring practices. Don’t focus on where candidates have been. Focus on what they can do.
If your organization is looking to restructure how you hire and focus on skills-based hiring, Promark is here to help. Our team specializes in guiding businesses through this transition, offering strategic consulting, leadership training, and workforce development solutions. Embracing skills-based hiring isn’t just about filling open positions—it’s about building a dynamic, future-ready workforce that drives innovation and long-term success. Let Promark help you make the shift and unlock the full potential of your talent strategy.