For years, recruitment processes have often started with qualifications that are easy to identify on a CV: educational degrees, previous job titles, and years of experience. These qualifications remain relevant, but they do not always show what a candidate can actually do in a role.
As technology evolves, the skills required in the workplace are changing as well. LinkedIn estimates that 70% of the skills used in most jobs will change by 2030, with AI being one of the key drivers of this shift.
This change is encouraging companies to consider skills-based hiring, a recruitment approach that places greater emphasis on candidates’ skills and capabilities rather than relying solely on their degrees or previous job titles.
For companies in Indonesia, this approach can also provide access to a broader talent pool. However, skills-based hiring does not mean companies should disregard formal education. The more relevant question is whether a particular qualification is genuinely necessary to perform the role.
What Is Skills-Based Hiring?
Skills-based hiring is a recruitment approach that evaluates candidates based on the skills and capabilities required to perform a job, rather than relying solely on educational degrees, job titles, or traditional career paths.
For example, a company hiring a Social Media Specialist may traditionally look for candidates with a degree in Marketing or Communications and at least two years of experience in a similar position.
With a skills-based hiring approach, the company may focus more on capabilities such as:
- Social media strategy
- Content creation
- Copywriting
- Audience analysis
- Social media analytics
- Content planning
- Performance reporting
With this approach, candidates who developed their skills through freelance projects, internships, certifications, bootcamps, personal projects, or experience in other roles can still be considered as long as they can demonstrate relevant capabilities.
The same approach can be applied to roles in technology, finance, sales, operations, and other functions where candidates can demonstrate their capabilities through experience, portfolios, assessments, or work results.
Read also: Slow Hiring: How Delayed Recruitment Impacts Business
Why Is Skills-Based Hiring Gaining Attention?
Changing skill requirements are one of the reasons why skills-based recruitment is receiving more attention.
AI, digitalization, automation, and changing business models are creating new positions while also changing the responsibilities of existing roles. As a result, a job title or educational background does not always provide a complete picture of the capabilities a company needs.
According to LinkedIn, 70% of the skills used in most jobs are expected to change by 2030, meaning companies need to continuously adapt how they identify and evaluate talent.
Several factors are contributing to this shift.
Changing Skill Requirements
A job title does not always represent all the capabilities a person has.
Two candidates with the same job title can have very different technical skills. On the other hand, someone who previously worked in a different role may have transferable skills that are relevant to the position a company needs to fill.
As roles continue to evolve, companies need to understand the skills actually required to perform the job rather than relying solely on experience with the same job title.
The Need to Address Skills Gaps
Companies increasingly need specific skills, including capabilities related to AI and technology.
In Future of Recruiting 2025, LinkedIn reports that 93% of talent acquisition professionals consider the ability to accurately assess candidate skills important for improving quality of hire. LinkedIn also found that companies with higher use of skills-based searches were 12% more likely to make a quality hire than companies with lower usage.
This figure is based on LinkedIn’s own data analysis. In its methodology, LinkedIn measures quality of hire using a combination of demand, retention, and internal mobility, so the figure should not be treated as a guarantee that the same result will occur for every company.
A Broader Talent Pool
Overly strict requirements can cause companies to overlook candidates who have relevant capabilities but do not follow a traditional career path.
LinkedIn Economic Graph found that skills-based hiring can expand talent pools globally, particularly for candidates without a bachelor’s degree. Indonesia is also included among the countries where this potential talent-pool expansion has been identified.
This means companies do not always need to look for candidates with backgrounds identical to those of previous employees. Candidates with relevant skills can also become part of the talent pool.
Increasingly Diverse Career Paths
Skills are not only developed through formal education or full-time employment.
Professionals can develop their capabilities through:
- Online courses
- Certifications
- Freelance projects
- Internships
- Bootcamps
- Personal projects
- Internal mobility
- Self-directed learning
As a result, someone’s current capabilities may be broader than what can be seen from their degree or previous job title.
Skills-Based Hiring vs Traditional Hiring
The difference between traditional hiring and skills-based hiring does not mean companies have to choose between degrees and skills.
The key difference is what becomes the primary basis for evaluating candidates.
| Aspect | Traditional Hiring | Skills-Based Hiring |
| Main Focus | Degree, job title, and previous experience | Skills and capabilities required for the role |
| Candidate Evaluation | CV, education, and career history | Skills, experience, assessments, portfolio, and work samples |
| Career Background | Tends to prioritize experience in the same or similar position | Can consider transferable skills from different backgrounds |
| Qualifications | Formal credentials may serve as an initial filter | Skill requirements become an important part of the evaluation |
| Assessment | CV screening and interviews | Interviews combined with skills assessments, work samples, or practical tests |
| Talent Pool | Can be more limited due to formal requirements | Can include candidates from more diverse backgrounds |
| Application | Relevant for roles requiring specific qualifications | Relevant for roles where capabilities can be practically demonstrated |
In practice, companies do not have to abandon traditional qualifications. What matters more is determining which requirements are genuinely necessary to perform the job and which have simply become standard practice in hiring.
Do Degrees Still Matter?
The development of skills-based hiring does not mean educational degrees have become irrelevant.
According to the World Economic Forum Future of Jobs Report 2025, 81% of companies expect to continue using work experience as an assessment method between 2025 and 2030. Meanwhile, 48% of companies expect to use skills assessments, while 43% still expect university degrees to remain a requirement.
This shows that companies are not necessarily replacing degrees with skills assessments. Instead, they are using more ways to understand whether candidates actually possess the capabilities required for a role.
Degrees can still be an important part of the hiring process for positions that require specific academic knowledge, professional qualifications, licensing, or specialized technical foundations.
Therefore, the more relevant question for companies is not:
“Should we remove degree requirements?”
But rather:
“Is a degree actually necessary to perform this role?”
If it is necessary, the qualification can remain part of the hiring criteria. If it is not, making it a strict requirement may narrow the talent pool without providing significant additional insight into a candidate’s actual capabilities.
What Does Skills-Based Hiring Look Like in Practice?
Implementing a skills-based hiring strategy requires more than simply removing “Bachelor’s degree required” from a job description.
Companies need to reconsider how they define roles, source candidates, conduct assessments, and make hiring decisions.
1. Identify the Skills the Role Actually Requires
Start by identifying the capabilities that directly contribute to success in the role.
For example, a Performance Marketing Specialist may require:
- Paid advertising
- Campaign optimization
- Data analysis
- Conversion tracking
- A/B testing
- Reporting
- Budget management
These requirements can provide a more relevant basis for evaluation than simply specifying a particular educational background.
2. Separate Must-Have and Nice-to-Have Skills
Not every requirement in a job description has the same level of importance.
Companies can divide them into:
- Must-have skills: Skills genuinely required to perform the core responsibilities.
- Trainable skills: Skills that can still be developed after the candidate joins.
- Nice-to-have skills: Additional skills that may improve performance but are not essential requirements.
This can help hiring teams avoid rejecting candidates simply because they do not meet every requirement, even when they possess the core competencies needed for the role.
3. Use Skills-Based Sourcing
Recruiters can search for candidates based on a combination of skills rather than relying only on job titles.
For example, instead of searching only for candidates with the title “Data Analyst,” recruiters can look for combinations of skills such as SQL, Python, Power BI, data visualization, and statistical analysis.
This approach can help identify candidates with relevant capabilities even when their job titles or career backgrounds are different.
4. Assess Skills Directly
Skills-based hiring requires evidence.
Depending on the role, companies can use:
- Technical assessments
- Case studies
- Work samples
- Portfolio reviews
- Simulations
- Structured interviews
- Practical assignments
This allows hiring teams to see how candidates apply their knowledge and skills rather than relying only on information presented in their CVs.
5. Consider Transferable Skills
Candidates do not always need previous experience in exactly the same position to possess relevant skills.
For example, someone who previously worked in customer success may have communication, stakeholder management, problem-solving, and relationship-building skills that can be applied to an account management position.
Understanding transferable skills can help companies identify candidates who might otherwise be overlooked if screening is based only on previous job titles.
What Are the Benefits of Skills-Based Hiring for Companies?
When implemented effectively, skills-based hiring can provide several benefits for companies.
Broader Access to Talent
Reducing unnecessary qualification barriers can allow companies to consider candidates from more diverse educational and professional backgrounds.
This can be particularly relevant when the talent pool for a position is limited.
Better Alignment Between Candidates and Roles
By evaluating the skills actually required for a position, recruiters and hiring managers can focus more directly on a candidate’s ability to perform the responsibilities of the role.
More Relevant Assessments
Skills-based recruitment encourages companies to create assessments that are directly connected to the job.
Rather than only asking what candidates have done before, companies can also evaluate how they solve problems or perform tasks relevant to the role.
More Opportunities for Non-Traditional Candidates
Professionals who developed their capabilities through certifications, freelance work, bootcamps, internships, or career transitions may have relevant skills even without the traditional credentials companies typically look for.
Supporting Quality of Hire
Data from LinkedIn shows that companies with higher use of skills-based searches were 12% more likely to make a quality hire. However, this result is based on LinkedIn’s platform data and its own definition of quality of hire, so it should not be interpreted as a universal causal relationship.
What Are the Challenges of Skills-Based Hiring?
Despite its potential, implementing a skills-based recruitment strategy also comes with challenges.
Defining Skills Is Not Always Easy
Companies need to clearly define what the required level of a particular skill looks like.
For example, simply writing “communication skills” does not explain how that capability should be demonstrated or measured.
Skills Need to Be Measured Consistently
If every interviewer uses different standards, skills-based hiring can still become subjective.
Structured interviews, practical assessments, and clear evaluation criteria can help create a more consistent process.
Hiring Managers and Recruiters Need Alignment
Recruiters and hiring managers need to agree on which skills are genuinely essential before sourcing begins.
Otherwise, a company may remove the degree requirement while continuing to use other unnecessary filters.
Technology Does Not Replace Human Judgment
AI and recruitment technology can help recruiters identify skills, analyze CVs, and support assessments. LinkedIn also notes that AI can help recruiters analyze resumes to identify skills and automate parts of the skills assessment process.
However, technology should remain a supporting tool rather than a replacement for human judgment. Recruiters and hiring managers still need to consider context, communication, motivation, experience, and how a candidate’s skills align with the team’s needs.
When Should Companies Use Skills-Based Hiring?
Not every position needs to be evaluated using exactly the same approach.
A skills-based hiring strategy can be particularly relevant when:
- The skills required for the role are changing rapidly.
- A job title does not fully describe the capabilities required.
- The company is struggling to find candidates with specific skills.
- Skills can be demonstrated through practical assessments.
- Candidates can come from different educational or professional backgrounds.
- The company wants to expand its talent pool without lowering its standards.
At the same time, formal qualifications should still be used when they are genuinely required by the nature of the job, professional standards, or regulations.
The goal is not to remove standards from hiring. It is to make sure those standards are actually relevant to the job.
What Does Skills-Based Hiring Mean for Companies in Indonesia?
For companies in Indonesia, skills-based hiring in Indonesia can be one approach to addressing changing talent needs.
This approach is particularly relevant for roles in technology, digital marketing, data, cybersecurity, product, and other functions where required skills can evolve faster than formal education or job titles.
LinkedIn Economic Graph shows that skills-based hiring can expand the talent pool, including candidates without a bachelor’s degree, while the World Economic Forum shows that work experience and skills assessments remain important parts of how companies evaluate candidates.
For employers, this means recruitment strategies need to become more specific about what they are actually looking for.
Instead of simply asking whether a candidate has followed the expected career path, hiring teams can start asking:
“What skills does this role actually require, and what evidence shows that the candidate has them?”
This shift can help recruiters consider a wider range of candidates without lowering the standards required for the position.
The Future of Skills-Based Hiring
The development of skills-based hiring is likely to continue as technology and job requirements evolve.
With 70% of the skills used in most jobs expected to change by 2030, companies need recruitment processes that can adapt to new requirements rather than relying only on static qualifications.
However, this does not mean degrees, job titles, or previous experience will disappear from recruitment.
Instead, companies can combine different forms of evidence to understand whether a candidate has the capabilities required to succeed in a role.
For recruiters, this means becoming increasingly capable of identifying skills, understanding transferable skills, and recognizing which capabilities are actually connected to success in a particular position.
For hiring managers, it means defining roles around the outcomes and capabilities required rather than simply replicating qualifications from previous hires.
For candidates, this shift further highlights the importance of demonstrating capabilities through portfolios, projects, assessments, achievements, and practical experience.
Why Is Skills-Based Hiring Important in Modern Recruitment?
Implementing skills-based hiring does not mean companies need to ignore degrees, work experience, or formal qualifications. What matters is ensuring that every requirement used in the recruitment process is genuinely relevant to the needs of the role.
By focusing on the skills required, companies can evaluate candidates based on what they can actually do, rather than only their educational background or previous job title. This approach can also help companies consider candidates with different career paths, transferable skills, or experience gained through projects, certifications, and other forms of learning.
For recruiters and hiring managers, this shift also requires a clearer understanding of which skills are must-haves, how those skills can be measured, and what evidence can be used to evaluate candidates.
Ultimately, skills-based hiring is not about choosing skills over degrees. It is about building a recruitment process that can evaluate the combination of skills, experience, potential, and business requirements more effectively.
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Implementing skills-based hiring requires more than simply changing the requirements in a job description. Companies need clear skill requirements, structured assessment processes, market knowledge, and access to candidates who match their business needs.
For companies with specific hiring requirements, a limited talent pool, or a need for candidates with a particular combination of skills, a recruitment partner can help expand access to candidates while maintaining the relevance and quality of the talent being considered.
Geekhunter helps companies identify and reach professionals who match their business needs through an approach that combines talent sourcing, market understanding, candidate engagement, and recruitment expertise.
With a more targeted hiring process and candidate evaluation focused on relevant skills, companies can expand their talent pool and make more effective hiring decisions.
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