Hiring's new twist: Focusing on skills could surface 19x more candidates

If you need to hire top-tier talent in ultra-competitive industries, it’s hard to match the advantages enjoyed by elite employers such as Apple, Accenture, Boeing and JPMorgan, all of which were recently featured on LinkedIn’s 2023 list of U.S. Top Companies .

But one vital part of the Top Companies’ playbook is moving into the public domain – available for any employer, large or small, to put to work.

The key concept involves “skills-based hiring.” That’s a shorthand term for employers’ ability to spot people whose prior experience has imbued them with most – or even all – of the key skills needed to succeed in a new role, even if these candidates haven’t ever held that exact title before.

Inside elite companies, “skills-based” promotions, rotations and talent development are a way of life. Today’s help-desk technician could be on track to become an IT manager in a few years, gradually picking up all the key skills that she or he needs, until being ready for that big promotion.

Now, skills-focused pathways are opening up, so that smaller employers – or ones with limited internal pipelines — can spot emerging candidates for hard-to-fill positions, no matter where such prospects are working at present.

What’s the full power of this skills-based approach? A new analysis by LinkedIn’s Economic Graph team finds that the candidate pool across the entire U.S. economy could be widened 19x, with even bigger gains in many important industries.?

As the chart above shows, even in sectors with especially uncommon expertise – such as oil, gas and mining – the LinkedIn analysis shows that a skills-based approach still could expand the pool of potential candidates by a factor of 13.5.?

More typically, this skills-first approach has the potential to expand the talent pipeline by a factor of 30 or more. Notable examples include technology, information and media (30.8), manufacturing (31.4), hospitals and health care (34.1) and education (36.8),?

To see this dynamic in action, consider the options in trying to hire an information technology manager. That’s a stressful search if you’re looking only at the narrow and hard-to-raid pool of people who already are IT managers. But with a skills-based approach, your candidate pool expands to people in junior or parallel roles at other employers. Such people often already have crucial experience in relevant areas.?

For example, a service desk manager may be well-versed in virtual private networks, VMware, active directory and more. A technical analyst may have the strengths you need in areas such as disaster recovery, troubleshooting and software development life cycles.

It’s a similar story in fields such as mechanical engineering. People who have worked in related jobs such as design engineers or manufacturing specialists often already have deep expertise with key tools such as MATLAB, Siemens NX and SolidWorks. They also bring strong groundings in relevant areas such as lean manufacturing.

In this analysis, candidates’ work histories are matched with a sophisticated analysis of the likely top skills for those jobs, using the LinkedIn Skills Genome to evaluate self-reported skills on millions of members’ LinkedIn profiles. While such skills profiles are important signals, they don’t guarantee that each new candidate possesses deep enough expertise to succeed in a new role.?

Another cautionary note: skills matching alone isn’t sufficient for roles that require specific licenses or certifications. (People wanting to become doctors, social workers and the like can’t enter those fields until earning officially recognized credentials.)

Those barriers aside, the opportunities associated with skills-based methods are vast.?And for even more insights on this topic, check out this detailed report from LinkedIn's Economic Graph team.

One more prospect to watch: Skills-based approaches may help surface promising candidates from under-represented groups. Among mechanical engineers, for example, LinkedIn data shows that women constitute only 13% of current job holders. But women are a significantly larger share of manufacturing specialists (34%) and CAD specialists (26%).?

What do we already know about hiring capable people into a new job that’s slightly different than what they’ve done before? That is actually what large, well-run companies do all the time – as they develop their own talent pipelines.

Boeing, for example, expects to hire about 10,000 employees this year, focusing in part on engineering and manufacturing roles. Those hires will range from recent university grads to more senior engineers. The aerospace company is “steadily growing our engineering base by finding and upskilling the talent we need,” a company spokesperson says.?

“The competition for talent has never been greater, but what drives people to Boeing is the mission,” says Lynne Hopper, vice president for engineering, strategy and operations at Boeing.” Or, as the company likes to say: “Engineers can find a career development path through Boeing.”?

Methodology

Data comes from the skills LinkedIn members add to their profiles. Specific skills and jobs are associated together only if a high number of workers cite that skill on their profiles when holding that job.The impact of skills-based hiring is calculated by comparing the direct experience pool (people who have held a given target occupation in the past five years) versus the relevant skills pool (potential candidates whose roles in the past five years contain skills relevant to the target occupation).

LinkedIn data scientists Nikhil Gahlawat and Silvia Lara contributed to this report.