Shifting Into Hiring Gear: New SHRM Foundation Research Shows Skills-First Talent Strategies Are Accelerating

ALEXANDRIA, Va. – Today, SHRM Foundation, with funding from Walmart, announced the launch of a comprehensive new research report, The Skills-First Movement: Redefining How Organizations Hire and Grow. This pivotal study analyzes the current state of skills-first practices, revealing a sizeable shift where organizations prioritize demonstrable competencies over traditional degrees to expand opportunities and widen talent pools.

Building upon data collected in 2021, the new report highlights how skills-first talent management, an approach focusing on people’s skills regardless where they were acquired, has evolved from an emerging trend to a strategic advantage. The research indicates human resource professionals and supervisors now rank relevant work experience and demonstrated skills as the primary factors in hiring decisions, surpassing educational background. This transition empowers workers by recognizing diverse pathways to employment and enables organizations to tap into wider talent pools.

“As organizations navigate an increasingly dynamic labor market, we are witnessing a fundamental transformation in how talent is identified and nurtured,” said Wendi Safstrom, President of SHRM Foundation. “By championing evidence-based, skills-first strategies, supported by partners like Walmart, SHRM Foundation is committed to advancing inclusive hiring practices, unlocking opportunity, driving organizational growth, and shaping a future of work where everyone can thrive.”

Additional key findings include:

• Skills-First Hiring Is Gaining Momentum: 34% of organizations reported often or almost always using skills-first strategies in their hiring processes. 
  • Among those who never or rarely use them, more than half (55%) expressed interest in adopting these strategies.
• AI is Reshaping Skills Demands: More than 80% of HR professionals, HR executives, supervisors, and workers agreed artificial intelligence will change which skills are valued.
  • 80% of HR professionals said they expect companies to prioritize hiring workers with AI-related competencies in the next three years.
• Upskilling Drives Better Employee Experience: Workers who said their organizations promote upskilling opportunities throughout the year were significantly more likely than workers who said their organizations do not promote such opportunities to feel engaged at work (59% vs. 31%).
  • They also report feeling more satisfied with their jobs (59% vs. 37%) and committed to their organizations (61% vs. 47%).

Some organizations face barriers to adopting the skills-first strategy, such as a lack of tools to support effective skills assessment and pressure to hire quickly. However, the data shows about two-thirds of HR professionals leveraging skills-first strategies receive a higher number of qualified applicants for open roles. The findings underscore a clear correlation between skills-first strategies and organizational success. By focusing on skills, leaders can drive transformative change and optimize their talent pipeline for superior business outcomes.

About SHRM Foundation

SHRM Foundation empowers Human Resources as a force for social good. As the nonprofit arm of SHRM, the world's largest HR professional society, the Foundation believes that HR holds a unique position to lead change in the face of complex challenges within the world of work. The organization mobilizes and equips HR to ensure the prosperity and thriving of talent and workplaces. The Foundation works by widening pathways to work for more skills-first candidates and more kinds of talent; tackling societal challenges, with a current focus on workplace mental health and wellness; and strengthening the HR field with even more diversity, growth, and readiness to address these needs. SHRM Foundation works with SHRM, courageous partners, and bold investors to generate awareness, action, and impact to build a world of work that works for all. Discover more at SHRMFoundation.org.

About SHRM

SHRM is a member-driven catalyst for creating better workplaces where people and businesses thrive together. As the trusted authority on all things work, SHRM is the foremost expert, researcher, advocate, and thought leader on issues and innovations impacting today’s evolving workplaces. With nearly 340,000 members in 180 countries, SHRM touches the lives of more than 362 million workers and their families globally. Discover more at SHRM.org.