Skills-First Hiring: The Basics, Examples, and Benefits

Traditional hiring is an exclusive process. Determining an individual’s fit for a role often begins with the university they went to, the degree they earned, and the professional titles they later held. This mindset may have filled office seats in the past, but it is an outdated luxury today as businesses struggle to find critical talent.

Skills-first hiring is the modern way of filling roles based on a person’s capabilities rather than their cachet.

The approach democratizes job opportunities, which widens talent pools. Focusing on capabilities also results in better matches, which improves performance, job satisfaction, and retention rates.

If you’re not familiar with the skills-first approach, keep reading.

What is skills-first hiring?

Skills-first hiring centers on a person’s capabilities and potential. Instead of filtering out people based solely on their resume, you consider talent by asking, Do they have skills that can transfer to the job? Do they have work experience that demonstrates their ability to do the job? Do they have the soft skills to grow into future roles?

In contrast, traditional hiring emphasizes the person’s background by asking questions like Do they have a four-year degree? Did they intern at a major firm? Did they have this job title?

Skills-first hiring centers on a person’s capabilities and potential rather than their background.

Of course, skills-first hiring includes necessary hard requirements too. If you were looking for a head nurse, you’d ensure they were licensed. The difference is instead of only considering nursing candidates with a college degree and at least five years of experience, you might also consider someone with three years of experience who is a skilled communicator, leader, and seasoned in handling challenging situations.

Skills-first vs. traditional hiring practices

Both hiring models aim to find the best person for a job. But a skills-first approach widens your talent pool and helps you make more accurate hiring decisions that are both good for the individual and the organization.

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Skills-first examples in the real world

The more you practice skills-first hiring through the business, the more resilient your workforce becomes. But you can also realize business benefits by starting small.

IT rethinks roles

An easy way to start skills-first hiring is by updating the requirements for specific roles. Take a software quality-assurance engineer for example. Many companies still demand a four-year degree, but 74% of Accenture’s and 71% of IBM’s postings for the role don’t.

Google gets general

When Google reviews applicants, their past roles have less sway over whether they’re good problem-solvers and have a “general cognitive ability.”

Concentrating on skills works best in Google’s fast-changing environment. In a podcast, Lisa Haynes, Global Head of Candidate Experience at Google, explained, “If you just hire someone to do one specific job but then our company needs change, we need to be rest assured that that person is going to find something else to do at Google. That comes back to hiring smart generalists.”

Crownpeak uses freelancers

You can also apply a skills-first approach to leverage the benefits of hiring freelancers. Upwork calls this practice skill sourcing.

Skill sourcing is an ideal solution for Crownpeak, a digital experience platform (DXP). The company often needs specific skills for a limited time and their traditional role-based recruiting process took weeks. By skill-sourcing talent through Upwork’s global marketplace, Crownpeak finds its talent within nine days on average, no matter how unique the skills required.

“There have been multiple instances where a hiring manager has believed a skillset was too niche—or too critical to success—to source except through direct recruitment,” said Alfie Callan-Shropshall, Head of Talent Acquisition, Crownpeak. “We believe differently, and we’ve consistently been able to fill those requirements.”

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Core principles of the skills-first approach

Following these core principles both expands your talent pool, while also preventing managers from overlooking someone great.

Value abilities over fluff

When filling an open role, ignore all of the old requirements and then ask yourself, What are the underlying skills required to succeed in this job? If certain certifications and licenses are required, then include them. But don’t put a college degree on the list when a degree isn’t necessary.

If a person has the skills and can do the work, then they should be considered for the work.

If you’re looking for a sales rep, don’t limit your talent pool by only considering people with prior sales experience. Instead, look for people with the skills required to succeed in the job. Skills such as problem-solving, active listening, and strong communication.

Look for transferable skills

Instead of sticking to how one job leads to another, think of how skills connect to work. Thinking this way aids you in using everyone’s skills optimally. This includes entry-level positions where candidates usually have limited professional experience. Here are ways to transfer skills:

• When a position opens up, you can create internal talent markets by looking for people in roles you didn’t consider previously. For example, a customer service agent with strong communication and organizational skills may move to HR.
• If an employee is a skilled web developer, they can use that skill by popping in and out of projects across the company.
• When a team is missing a critical skillset, they can contract an independent professional to jump in on a short- or long-term basis.
• Instead of laying people off, you can move them from low-growth to high-need areas.

Assess hard and soft skills objectively

Assessing skills may be one of the toughest parts of hiring. Going back to the sales rep example, someone who has done it well for five years will have developed specific soft skills. So how can you be sure the people you’re interviewing have those skills?

You may want to partner with HR, or contract a recruiting professional, to help you develop ways to test attributes that are important for the job.

Think through the markers you could use to assess their ability, so that you hire top performers. And avoid questions that may lead to unintentional bias. Questions like How do you spend your downtime? are “beer test” questions. In that the interviewer is looking for someone they like enough to have a beer with. This could exclude a lot of qualified people and lead to homogenous teams that look and think alike.

Benefits of skills-first hiring

Skills-first hiring gives businesses the flexibility to do what’s right for the individual so they can do their best work for the business.

Greater workforce diversity

Skills-first hiring democratizes job opportunities for people in traditionally marginalized groups. For example, a report by LinkedIn’s Economic Graph shows 24% more women make it into talent pools for jobs where they are excessively underrepresented.

You don’t just gain diversity from multiple cultures and backgrounds. You also gain multiple perspectives and ideas, which can increase the value of a team.

Wider and deeper talent pool

The same LinkedIn report shows that adopting a skills-first hiring model can add up to 20 times more eligible people to your talent pool. If you want to magnify that, include freelance talent. Just through the Upwork marketplace alone, you gain instant access to millions of professionals covering more than 10,000 skills—including many that are tough to find.

The Emerging Business team at Upwork uses the platform to find AI specialists and leading engineers to launch game-changing products in a fraction of the time. As work evolves, they keep pace with change by targeting new skills.

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Supports DEI efforts

Standard recruiting practices exclude a large number of people from disadvantaged groups. Even though many of them could do the job.

Consider how 72% of Black workers, 79% of Hispanic workers, and 61% of female workers do not have a college degree. Removing inflated degree requirements could give a large number of traditionally underrepresented people the opportunity to compete for higher-paying jobs and pursue careers with greater growth potential.

One way Vito Labate, Vice President of Global Industry Marketing at Capgemini, increases diversity is by skill-sourcing talent through Upwork. He said:

“I see it as my responsibility as a leader to provide the best experience for the people who belong to my team and to give them the chance to tap into their creativity—both by expanding upon the diversity of our team and by alleviating tasks that shouldn’t consume my team’s focus and time. [Skill sourcing] enables us to provide the creative direction that our stakeholders look to us to provide. And you really can’t put a price on the value that has.”

Higher job satisfaction

People want to do work they are good at and enjoy most, but the standard linear career path doesn’t always allow for that.

In contrast, the skills-based approach allows businesses to move talent where their skills will have the most impact. Talent appreciate the internal mobility as they can spend more of their time doing work they enjoy.

Job satisfaction is so important that businesses that are good at moving employees based on their skills retain them nearly two times longer than companies that don’t do it well. That’s according to the LinkedIn report we referred to earlier.

This finding is aligned with data from Upwork. A freelancer study shows 73% freelance so that they can pursue work they find meaningful.

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How to implement skills-first hiring

Implementing a skills-first model involves changing processes and beliefs, and eliminating biases. Getting it right will take time, so use your learnings to continue fine-tuning processes, asking deeper questions, and rejecting outdated practices.

Get everyone onboard

From executives to employees, everyone needs to understand how the new approach benefits employees and the business. Having everyone aligned from the beginning will help you keep moving forward when challenges arise.

Take a skills inventory

Break every role within the business down to a set of skills required to do the job well. And look at every set of skills each worker provides. From that data, identify what skills your business has, what it needs today, and what it needs to remain competitive in the future. Then create a plan to fill skills gaps by upskilling or reskilling employees, hiring or contracting talent, and moving people to better-fitting roles.

Update job descriptions

Toss out old requirements that don’t affect how a skilled person can do the job. Get out the habit of looking for keywords in resumes. Think of ways you can make more accurate matches based on a person’s capabilities. Ask questions like, Do they really have to work onsite? What transferable skills apply? What are the critical skills required for the role?

Make time for reskilling/upskilling

Help employees grow—and shore up workforce resiliency—by providing time for upskilling and reskilling on the job. Offer employees opportunities to work on projects in other functions so they can broaden their experience and advance their skills. Instead of laying people off, reskill them for growth areas of the business. Make learning opportunities available online so they accommodate different schedules and so remote workers can participate.

Broadcast wins regularly

Transitioning to a different hiring model will create a lot of positive change. But some people will still resist, so you’ll need to focus on change management. One way to chip away at their resistance is by helping employees feel less risk around making the change. An effective way to do that is by regularly evangelizing the program and sharing wins. No win is too small to broadcast companywide. When sharing success stories, be sure to include statistics showing what wasn’t working and how skills-first hiring improved the situation.

Build a support network

Connect with other businesses that are already using or implementing skills-first hiring. Sharing ideas and talking with like-minded leaders may help you avoid pitfalls and overcome challenges faster. Seek partners, such as Upwork, that are aligned with your workforce vision and have the experience and tools to help you reach your goals.

Help managers prepare

Train managers on communication and inclusive leadership skills so they know how to onboard, coach, and work with people from different backgrounds. Training should also include leading remote teams. Even if all employees work onsite, chances are they’ll work with a vendor, freelancer, or consultant who works remotely.

Launch your skills-first journey with Upwork

Talented workers are everywhere, but you risk overlooking them if you’re still hiring for roles instead of skills.

Understand that skills-first hiring isn’t a trend. It’s a solution that enables you to overcome talent shortages caused by things outside of your control. Things including social and demographic trends, technological advances, and budget constraints.

As important, skills-first hiring honors people by providing opportunities for individuals to share their ideas, contribute to the business in bigger ways, and live better lives.

Upwork offers several ways to support your entire skills-first journey. Visit the marketplace to consult with an industry expert, get a quick project done, and contract specialists short- and long-term.