A Guide to Skills-Based Hiring
The information in a guide to skills-based hiring will help you learn why skills-based is the best way to hire early-career talent, how to adopt skills-based hiring practices, how to use skills-based hiring for job auditioning, and how to use skills-based hiring to build your talent pipeline.
Skills-based hiring prioritizes a candidate's practical skills and competencies over other criteria such as academic degree, GPA, personal referrals, or other credentials, which have repeatedly been proven to lead to ineffective and biased hiring outcomes. The skills-based hiring approach is critical to early-career hiring, where an organization is hiring for potential vs. hiring based on previous experience. Skills-based hiring uncovers someone's current abilities and core skills not easily articulated on a resume, such as communication, creativity, time management, problem-solving, etc.
Suppose you find yourself amongst the millions of employers who notice that the old standard approach to hiring is systematically screening out high-caliber candidates. This skills-based hiring guide will come in handy! It has everything you need to know to leave inefficient hiring practices behind and adopt a new approach where candidates with the demonstrated skills and performance for your roles don't go overlooked. Learn more about us and how we've mastered the skills-based hiring approach.
Table of contents
Why skills-based hiring is the best way to hire early-career talent
How to adopt skills-based hiring practices
How to use skills-based hiring for job auditioning
How to build your talent pipeline with skills-based hiring
The rise of skills-based hiring
Skills-based hiring is the practice of employers setting specific skill requirements for a certain job position. With this hiring approach, candidates are not screened out due to rigid prior experience requirements. Instead, candidates are assessed on their existing skills and aptitude for learning required for the role.
Skills-based hiring is a fail-proof and straightforward concept to ensure you focus on candidates that can make an immediate impact in your organization. Hiring based on specific competency or skill requirements is the new way to reach, entice, and ultimately higher qualified professionals.
Skills-based hiring for early-career
Early-career professionals, by definition, have limited prior professional work experience and are often screened out by ATS filtering and AI systems for entry-level roles, despite being skilled and capable. Traditional hiring focuses on past experience, academic degrees, certifications, etc., which most entry-level job seekers don't have or are still in the process of acquiring. While some roles may require specific hard skills, a candidate's college major or GPA is an ineffective way to screen candidates and is used by fewer than half of employers.
Traditional hiring may be unintentionally biased and deters great candidates, such as student-athletes, who are more likely to have a lower average GPA than students without heavy training and competition schedules. Yet, these potential employees have proven communication skills, teamwork, and discipline desirable in any industry. Skills-based hiring will level the playing field, improve hiring outcomes, and ensure that you don't miss out on high-potential talent but rather make the skills required for your role the standard for who gets an interview and is ultimately hired to get the job done.
As the largest network of highly motivated college students and recent graduates, Parker Dewey has mastered skills-based hiring by providing opportunities to engage prospective candidates on real work projects. Learn about skills-based hiring through Micro-Internships.
With more than 11.3 million job openings in the United States, finding the right employees for your company can be challenging. You want intelligent and capable people, but you also need them to be a good fit with your team and culture. And of course, you need to find someone able to perform the job.
One way to make the process easier is to adopt skill-based hiring practices. Here are a few ways to ensure your hiring practices align with your company's needs.
Reassess the necessary skills needed for each job
Take a look at the skills needed for each job within your company, and this will help you identify which skills are most important and what kind of person would be the best fit for each role. Are there some skills that can be acquired through learning on the job instead of needed before applying? Is the number of years of experience and qualifications relevant to the position? For example, if you have an entry-level job, requiring years of experience or a degree might not be necessary if there is a lot of hands-on training and learning involved in the role.
Remove the fluff from your job description
Once you have a better idea of the skills needed for each job, it's time to look at your current job descriptions. Are they filled with unnecessary qualifications or requirements not relevant to the role? While experienced recruiters and hiring managers know that a job ad is a wishlist, early-career candidates are deterred from applying if they don't feel they fit and meet all the requirements. However, 60% of employers are willing to hire applicants with less than the required work experience.
Your job descriptions should be clear and concise, highlighting the essential skills. These straightforward job descriptions will help you attract candidates who are the best fit for the job and weed out those who are not qualified.
Add assessments to review qualifications and skills
Once candidates who seem qualified based on their applications are identified, the next step is to put them through an assessment to review their skills and qualifications further. Common hiring assessments, such as personality assessments, aren't skills-based. While a job simulation can be more accurate, it'll still have its limitations as it's a recreation of a possible scenario a candidate may face on the job, not a live task that needs completion.
Real work through a Micro-Internship is the best way to assess someone's skills. More than 30% of companies already use this to avoid wasted time on interviews with candidates who don't have the skills needed for the job. Check out our Micro-Internship templates; these are premade project templates that you can use to assess a candidate's skills and work ethic.
There are a few different ways you can conduct job auditions. While you can have a candidate come in for an in-person job audition, you can also do them over the phone or even entirely online. It depends on the role you're hiring for and your available resources.
Identify the appropriate method for auditioning
Method one: Micro-Internships
Utilizing Micro-Internships for job auditioning is a highly effective way to understand a potential employee's skills and abilities to assess if they're a good fit for the job.
To start, identify the most critical skills for the role you're hiring for to effectively job audition. Then, create a list of tasks or problems that the candidate would need to solve to show off these skills. For example, if you're hiring for a content creation role, the skills that would be critical for this role include:
- Researching a topic
- Employing empathy to understand the audience
- Attention to detail for the editing process
- Being receptive to feedback
- Implementing edits
To test these skills, have the candidate complete a content creation Micro-Internship where they'll have the opportunity to write content on the topic of your choice. Out of all the above valuable skills, candidates may only list one on their resume, such as “writing," this is why Micro-Internships will help you more thoroughly assess a candidate's skillset and fit for your open role.
Suppose you're hiring for a sales development representative, have candidates complete a sales development representative assessment. This Micro-Internship will help you identify the best salespeople by seeing them in action. Check out our guide to entry-level hiring for sales development representatives.
Method two: Job simulation
If you want to take things a step further, you can also consider using a job simulation. This approach is where the candidate is given a task they would need to complete as part of the job. For example, if you're hiring a web developer, you could have them complete a website development project. These projects are a great way to see how candidates work under pressure and assess how they solve problems.
Be transparent about how long the simulation will take and the expectations. This way, the candidate knows what they're getting into and can prepare accordingly.
Method three: Case study interview
You may also choose to implement the case study interview method. This method is similar to a job simulation where candidates are not doing real work but are given a real-world example and asked how they would've gone about solving the issue and doing the work. This method is not a typical 'question and answers' interview, and it involves having candidates work through a business problem to reach a logical solution. The candidate's performance will give you insight into how the candidate would perform on the job.
Evaluate candidates based on their performance
Once the job audition is complete, it's time to evaluate the candidates. Go over their performance with a team of interviewers or review it yourself if you're the only one conducting the interviews. Either way, you should have a scoring system before the job audition is complete to inform the candidate if they should've put more effort in certain areas, delivered as expected, did an impressive job, or executed like an industry veteran. A scoring system will help you assess each candidate and identify the best fit for your open role. If you choose to job audition candidates utilizing Micro-Internships, we have an internship project evaluation scorecard ready for your convenience!
Use the information to make a hiring decision
Once you've gone through all candidates, it's time to decide. It's at this point that the skills-based hiring approach shines. You should have a good idea of who the best fit is because you've assessed each candidate based on their skill set. The job audition makes it easier to decide and helps ensure that you're hiring the right person to get the job done!
Companies need to hire new employees at different stages and sometimes unexpectedly. Some positions need to be filled because they're brand new, while others become open due to promotions or retirements. It's always a good idea to have a talent pipeline to ensure that you have a group of qualified candidates to choose from when a new role needs to be filled. In this section, we'll break down exactly how you can build a talent pipeline using skill-based hiring:
Define the skills and competencies you're looking for
Define the skills and competencies you're looking for in candidates. This will vary depending on the roles you typically hire for and your company's specific needs. For example, your sales associates will need a drastically different skill set than your product development specialists.
If you're looking to hire early-career candidates for your open roles, they may have little to no experience, which doesn't necessarily mean they are not career-ready. According to the National Association of Colleges and Employers (NACE), career readiness is a foundation from which to demonstrate requisite core competencies that broadly prepare the college-educated for success in the workplace and lifelong career management. To successful assess the career readiness of early-career talent, look into the candidate's following areas:
- Self-development (Continual personal and professional learning, awareness of one's strengths and weaknesses)
- Communication (Clearly and effectively exchange information, ideas, facts, and perspectives)
- Critical thinking (Identify and respond to needs based upon an understanding of situational context and logical analysis of relevant information)
- Leadership (Recognize and capitalize on personal and team strengths to achieve organizational goals)
- Professionalism (Understand and demonstrate effective work habits, and act in the interest of the larger community and workplace)
- Teamwork (Build and maintain collaborative relationships to work effectively toward common goals, while appreciating diverse viewpoints and shared responsibilities)
Once you understand the skills you need, you can look for candidates who possess them.
Categorize talent based on specific skill sets
It's time to start categorizing talent based on their skill sets. This will help you track who has the specific skills you're looking for and make it easier to reach out to them when a new role opens up. For example, if you're looking for future web developers, you would keep track of all the potential candidates who have skills that would fit the job description, such as HTML/CSS skills, interpersonal skills, problem-solving, etc.
Build relationships with potential candidates
Start building relationships with potential candidates. You can do this in several ways, such as attending industry events, connecting with people on social media, and college career fairs. You can also reach out to candidates directly and invite them to coffee or lunch. The goal here is to get to know their career goals, plans for the future, and what they're looking for in a company. This way, you can determine if they would be a good fit for your company and if they're interested in working with you down the road.
This communication is also an excellent opportunity for candidates to learn more about what you offer as an employer and potential career paths. Maintain the connection without overdoing it. Send them information related to your industry, or check in on a special occasion such as their birthday. By maintaining regular contact, you'll ensure that they keep your company top-of-mind and increase the likelihood that they'll want to work with you when the time comes.
For further reading, download our ebook, Beyond Interns, Temps, and Freelancers: How to Engage Students and Improve Entry-Level Hiring Outcomes.
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