Who needs a university education if you have the skills to do the job?
A growing number of companies in Australia are taking a skills-based approach to talent to stay competitive in a tight jobs market.
LinkedIn’s latest Future of Recruiting report says finding candidates with the desired skills is a significant challenge for more than two-thirds (63%) of Australian and New Zealander (ANZ) recruiting professionals.
Eight in ten (83%) recruiters are prioritising skills-based hiring and upskilling and reskilling their employees.
LinkedIn’s report defines the approach as the practice of valuing a candidate’s skills over more superficial signals such as an impressive university or previous employer.
Since 2019, the share of recruiter searches on LinkedIn that include a skills filter has grown by 25%. Today recruiters are 50% more likely to search by skills than they are to search by years of experience.
When hiring for jobs that have seen steady growth, LinkedIn sees a global talent pool increase of 24% for workers without a bachelor degree compared to those who have a university education. In Australia, that's only slightly lower with a 17% difference.
Adam Gregory, senior director, APAC Talent & Learning Solutions: “In recent years, there has been a distinct shift in the new world of work with companies starting to hire candidates based on their unique skill set.
“This change will continue to shape hiring strategies, allowing businesses to connect with a broader candidate pool to those who may not have traditionally fit the job description, ultimately driving a more equitable workforce.
“On top of this, the fast pace of technological innovation has also meant that new skills are required for many workers.
“At LinkedIn, we often see that much of what our clients need in terms of talent is already inside a business, so to combat this change, smart companies should look to upskill and retrain their current employees, rather than looking externally.
“The combination of these two factors, as well as others, has meant that if companies focus on making skills a key component of their talent strategy, they will be able to retain staff and maintain a diverse workforce, while also allowing them to stay competitive in a tight labour market.”
Kirsty Tavae, managing director, TKR Recruitment, has detected a recent shift in hiring.
“More focus is on the skill-set of the candidate versus the education that they hold,” she says.
“It was an essential requirement in any briefing that they would hold a degree in the related field to be on a shortlist. This is no longer the case.
“There is a huge shift in the recruitment strategy for most companies to maintain and grow their talent internally while focusing on getting talent externally that only matches the check box for skills needed to fill that role. It’s an interesting market, that’s for sure.”
Simon Hadfield, executive partner, DMCG: “One size doesn’t fit all so having a good mix of experience, attitude, education and training and the right hands on skills is the perfect concoction.
“If you are highly skilled but can’t communicate or engage then that’s no good and if you have no real experience then you’re not a known entity.
“While this report certainly sounds interesting, all the same skillsets are required as they were 10, 20, 30 years ago. Same, same but different.”
Alex Kenning, managing director, Aquent Australia: "With the exception of junior and entry level roles, a skills-based approach to hiring is something we have seen an increasing trend for over at least the last decade in the marketing, creative and digital space. It’s nothing new.
"In addition, as new technologies are constantly being created and organisations are moving ever quicker to implement them, it is not feasible to demand a talent has five years experience using a tech that has only been released in the last two years.
"Instead we are seeing a demand for Talent who have experience in using similar technologies, who have the soft skills to thrive in change and have demonstrable experience in learning how to use and get the best from new technologies.
"This means that the soft, or business skills mentioned in the report (communication, relationship-building, adaptability, business acumen, and problem-solving) are critical — the challenge for organisations is how do they assess these skills in the traditional interview and hiring process."
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