Australia leading the charge in skills-based hiring: What are the benefits?

Hiring for skills is becoming the preferred recruitment method across Australia, causing candidates to rely less on things like CVs, education, and prior work experience.

As discussed in a TestGorilla report, skills-based hiring has become a popular means of recruitment across the world, as skills shortages plague various sectors.

Globally, 81 per cent of companies use skills-based hiring, up from 73 per cent last year and 56 per cent in 2022.

Australia is leading this charge, alongside Latin America, with 91 per cent of Aussie employers using this method in 2024. According to the survey, 92 per cent of employers who use multi-measure testing stated they are more satisfied with their hires and are seeing improvements in the following:

• Improved retention (94 per cent)
• Improved diversity (94 per cent)
• Reduced mis-hires (91 per cent)
• Reduced cost to hire (83 per cent)

“We are three years into producing The State of Skills-Based Hiring reports, and the trend is undeniably clear – skills-based hiring is becoming the dominant and preferred recruitment method, not just for businesses, but for employees seeking new jobs,” TestGorilla’s chief executive and co-founder, Wouter Durville, said.

“Degree requirements are not going away yet, with 59 per cent of employers saying it is actually more important for candidates to have degree qualifications. But skills-based hiring methods are complementing and, in many cases, replacing traditional recruitment, and organisations that don’t give non-degree-holding candidates a chance to demonstrate their skills are in danger of missing out on an untapped pool of talent.”

Marketing has been recognised as the profession that utilises skills-based hiring the most, with 95 per cent of companies in this space using the method. Following are construction and scientific/technical services, at 89 per cent each.

Candidates are able to leverage their skill set to secure a position. In fact, 81 per cent said they have gained new employment opportunities because of skills-based hiring, and 85 per cent said they prefer it because it gives them the opportunity to demonstrate their abilities.

Joan Pelayo, marketing specialist candidate, said: “If you’re applying for a remote job, chances are you’re competing against hundreds, if not thousands, of other candidates for one position. It’s very easy to go unnoticed. But with talent assessments, I know I have a chance to show that I’m a great fit for the role.”