Skills-first hiring reduces costs, expands access to overlooked talent pools, and improves retention. Firms across multiple industries are already seeing that this approach gives them a competitive advantage, empowering the creation of adaptable, future-fit teams.

From Credentials to Capabilities

A degree is an indication of academic attainment, highlighting what an individual has achieved throughout their higher education journey. But employers are realizing it doesn’t necessarily predict success in a role. While traditionally, many professional job vacancies have required applicants to hold a degree, some recruitment teams are now starting to explore capabilities ahead of credentials.

This shift has been happening for a few years. In 2022, the state of Maryland announced it would make 50% of its positions available to those without degrees. Over half of U.S. states have now followed that trend, opening up roles to those who haven’t followed traditional education pathways.

Corporate enterprises are following suit. IBM’s New Collar initiative is a prime example. The tech giant’s apprenticeship program follows an ethos of “No degree? No problem!” and is open to applicants of all ages.

One recent success story highlights a law enforcement officer who transitioned into a Microsoft data center, advancing to manager within a year. This is living proof that a focus on capabilities enables organizations to attract overlooked talent, aligning hiring decisions with evolving business needs.

Benefits of Skills-Based Hiring: Retention, Redeployment, and Inclusion

Changes to any hiring practice must be based on a real-term return on investment (ROI). Many organizations that prioritize skills are doing more than widening their talent pipelines. They’re also reducing their hiring costs and improving employee retention.

Take Walmart, for example. They realized they would need to fill up to 100,000 in-demand, higher-paying roles over a three-year period. Instead of traditional recruiting drives, they focused on upskilling existing employees. By unlocking the potential of their existing employees, the firm avoided hiring and training costs and minimized disruption across the organization.

The state of Delaware recently moved to skills-based hiring and saw a leap in applications of up to 575% for some career opportunities. The state is now deploying a tool called Career Moves to help job seekers, particularly tech talent, find the right training for in-demand industries.

Assessment Technology as an Enabler

Skills assessments and hiring platforms are accelerating this transition. Tailored reasoning questionnaires (ToRQ) and platforms like HireVue and HackerRank assess potential tech talent, looking at cognitive and behavioral skills as well as technical capabilities. The result? An emphasis on performance ahead of GPA.

Fintech giant Stripe is one company focusing fiercely on real-life scenarios when hiring. They present potential employees with a crisis scenario, like a failed checkout system, and ask how the candidate would go about debugging.

Robinhood, another modern financial services provider, also utilizes real-life situations combined with HackerRank-style tests during its applicant screening process. This approach ensures employers evaluate the skills that matter most and redeploy talent effectively across their organizations.

Building a Skills-First Culture

Switching to skills-based hiring practices isn’t just about shifts in written policy or throwing a few tests into interviews. It’s about changing the culture across entire organizations, highlighting how important skills are versus academic attainment. While a degree is still a serious achievement, it doesn’t show employers how well a candidate will cope with a crashed system during peak hours or a ransomware attack.

Companies can make the shift to a skills-first culture simpler by engaging personnel at all levels. States like Massachusetts have implemented executive orders stating that managers must identify the skills needed for a position and review candidates based on this. Rather than simply making this a vague instruction, the state has created an entire digital toolkit to support managers with this change.

For recruiters and recruitment partners, sifting candidates will become about matching skills to roles, rather than resumes to degree requirements. Hardwiring skills prioritization into recruitment will help build a skills-based culture from the ground up.

Partnering for Skills-First Hiring

You can start your move towards this beneficial culture before you even begin your recruitment drives by partnering with Per Scholas. Our technologists are trained in high-demand disciplines including cybersecurity, cloud, software engineering, and data analytics — entering the workforce ready to deliver impact from day one.

With more than 30,000 technologists trained and 1,000+ employers served, Per Scholas provides the proven model for building resilient, future-ready teams. For employers, the future of hiring isn’t about credentials, it’s about capabilities. And it’s already here.