Finding the right talent with the precise skills for each role is an ongoing challenge in today’s job market. To achieve this, it is essential to adopt a comprehensive strategy that combines a variety of tools and approaches. 

It all starts with clearly defining the competencies and knowledge required for each position. Conducting a detailed analysis of the tasks and responsibilities will help identify technical and soft skills that are essential in the search. 

Once these foundations are in place, it is necessary to design a rigorous selection process that includes technical tests, behavioural interviews, and psychometric assessments.Beyond evaluating candidates' theoretical knowledge, the focus should also be on assessing their problem-solving abilities, teamwork skills, and adaptability to new challenges. 

And this is where a term that has gained increasing traction comes into play: “la 'skills-based hiring'”. 

What does skills-based hiring mean?

Skills-based hiring represents a paradigm shift in recruitment—where the focus moves away from academic qualifications and traditional work experience, towards the specific competencies and aptitudes a candidate can bring to a role." 

Instead of focusing on a perfect CVwith extensive experience, companies are now looking for individuals who can demonstrate they have the necessary skills to perform a job effectively—regardless of their academic background or professional track record.

In one of the episodes of McKinsey Talks Talent, they explain it in a very simple and compelling way. Put simply, when a company adopts skills-based hiring, it is creating access to opportunities: if you have the skills—regardless of where you acquired them—and you can do the job, then you should have the chance to get that opportunity..

Imagine seeing a job advert that says, 'We will no longer require a university degree for this role.' What do you think applicants would highlight in their CVs or interviews? What’s the first thing that comes to mind? That’s right—their skills.

And what’s even more interesting is how underlying skills can also be extremely valuable.

Many times, companies struggle to find exactly the right person for a role—and the number of formal requirements usually demanded doesn’t help. However, if those requirements are reduced, it opens the door to underlying skills.

This means someone who possesses skills very similar to those sought, and who, once trained and given the opportunity to develop them, can reach the ideal the company needs. 

Bryan Hancocks, a partner at McKinsey, shares a very clear example. If a company is looking for someone with experience in video games, it might be difficult to find. But if we focus on the underlying skills required—such as software engineering, programming, or storytelling—there are many people who possess these skills and only need a short training period to apply them in video game development. Pretty great, isn’t it? 

Of course, not all companies feel ready for this type of recruitment.

Some question whether it’s just about skills or if attributes are involved too, which can be confusing. The goal is for companies to adopt a more holistic perspective.

What do I truly need from my employee to successfully achieve the objectives? Do I really need them to have 10 years of experience in, say, programming, or do I need them to have programming skills as if they already had 10 years in the field?

There can be many benefits when this hiring strategy is considered—for example, contributing to the creation of a more inclusive economy. 

And according to McKinsey experts,this is partly the reason for moving towards skills-based hiring. 

When we look at those who have the skills but not the qualifications, we are thinking about how to create more equitable pathways to opportunities that truly align with what people can do at work. 

Artificial Intelligence in This Type of Hiring

According to Hancocks , generative artificial intelligence can be useful in skills-based hiring and skills-focused practices.

Why? Mainly because it can help hiring managers write better skills-based job descriptions.

Generative AI can be particularly helpful for well-known positions. Hiring managers can clearly articulate what tasks need to be done and the underlying skills required. 

Generative AI can also help a person understand what they need to access some of those other positions, based on the skills they currently have. 

Another aspect Hancock highlights is the promise of Learning and Employment Records (LERs). 

This would translate into a lifelong academic record that, regardless of where the skill was acquired, allows the individual to have a documented record of it. 

Whether it’s a university course, an online certificate, or simply being named 'Employee of the Month,' everything is recorded

Benefits of Skills-Based Hiring for Employees 

The first words that come to mind are flexibility and opportunity. 

If someone starts a job in one position and later discovers they are very skilled in another area of the company, thanks to the skills they possess, they would end up in a role where they can be more productive and contribute more positively to the company’s growth. 

This employee would feel happy, and so would the company—because it gains the talent it truly needs.  

By focusing on each individual’s competencies and aptitudes, the unique set of talents every person brings is recognised and valued. 

This creates a stronger sense of belonging and motivation, as employees feel appreciated for what they can actually do. 

Moreover, skills-based hiring promotes a culture of continuous learning, where the development of new competencies is encouraged and opportunities for professional growth are provided. 

By removing traditional academic degree requirements, the door is opened to a greater diversity of profiles, enriching organisational culture and encouraging collaboration among people with different experiences and perspectives.

By creating this new environment, employees can feel more comfortable being authentic and expressing their ideas—ultimately contributing to a more positive and creative workplace atmosphere. 

Why Is Skills-Based Hiring Important?

Adaptability in a Changing World of Work

Skills become obsolete more quickly than university degrees. By focusing on skills, companies can find candidates who are able to adapt to new technologies and market trends.

More diversity 

By removing university degree requirements, the door is opened to a wider pool of candidates, fostering diversity and inclusion within organisations.

Improved Performance

Candidates selected based on their skills often demonstrate better performance in the role, as they possess the competencies needed to carry out tasks efficiently.

Reduction of Bias

Skills-based hiring helps reduce unconscious biases associated with work experience or academic qualifications, allowing employers to identify the best candidates regardless of their background.

How to Get Started with This Type of Hiring

In the words of Brooke Weddle, a partner at McKinsey: 'With skills-based hiring, you can fine-tune your learning and development strategy to be more specific in addressing existing skills gaps.

The key is to move away from hiring strategies focused solely on the most critical skill of a specific role or the hardest-to-find skill for that role. 

Instead, start hiring for all the skills required for that particular position.. Another important point is to prioritise the concept of training fields.. 

This means bringing in people who may not be ready to work immediately, but are ready to learn, be trained, and develop their potential so they can reach a Job Ready Profileas we call it at Alkemy.  

Many organisations see the value in this approach because there is currently a very critical skills gap.

McKinsey states that companies guided by skills experience lower turnover rates in their hiring cohorts, as employees begin to learn, feel comfortable, and explore their talents, resulting in greater confidence and willingness to stay. 

Of course, when applying this type of hiring, the talent arriving will be very diverse, and the responsibility will fall entirely on the company and its experience with onboarding. 

As Weddle points out, companies will need to ask themselves questions such as: 

• What are this company’s values? 
• What do we stand for? 
• What does it mean to be a leader here? 
• What behaviours are we looking for? 
• What mindsets? 
• What are some of the norms we practice to stay on track?

This is largely about having a clear strategy. It’s not just about switching to skills-based hiring, but doing so with a plan for what to do with that talent once it arrives, how programmes will be created, and many other variables.

In this way, finding the right talent with the right skills for each role will be guaranteed. 

By measuring and understanding each person’s skills using tools like Alkymetricsyou can select the most suitable candidate for the position and thus enjoy all the benefits that skills-based hiring offers.