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  • Writer's pictureCaroline

Unlocking Success: Strategies for Skills-Based Hiring

Updated: May 22

The retail and hospitality sector employs more people than any other sector in the United States. Around 20% of US employees work in retail and hospitality, which is 9 million more employees than any other sector. In today's competitive labor market, enterprises face numerous challenges when recruiting workers. Employers struggle to find quality candidates with the skills and experiences necessary for their open positions. The traditional hiring process often involves sifting through stacks of resumes, conducting time-consuming interviews, and struggling to find suitable candidates amidst a sea of applicants. Even after hiring, enterprises continue to grapple with high turnover rates, a recurring need to fill positions, and mounting recruitment costs.

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Retail and Hospitality Labor Crisis: Employees Fleeing in Record Numbers

Persistent attrition rates have long plagued the retail industry, with annual employee turnover among frontline retail workers consistently hovering around 60%. According to McKinsey, retailers have become accustomed to the daunting task of replenishing over half of their workforce annually. However, this challenge has intensified in the face of record-breaking inflation and ongoing political uncertainty. A staggering 50% of retail employees reported contemplating leaving their positions last year; this crisis continues to prevail. Even more concerning, a substantial 63% of frontline retail managers reported considering their own departures in the past 12 months, with many transitioning out of the retail sector altogether.

Future-Proof Your Workforce: A Skills-Based Approach

Skills-based hiring focuses on sourcing and hiring candidates based on their current specific skillset instead of their experience or education. By honing in on their skills instead of what appears on their resume, employers are 60% more likely to make a successful hire for their open positions. By removing potentially unnecessary barriers to jobs like education and past experience, recruiters can widen their talent pools and reduce their annual employee turnover.

In the US, hospitality, food service, customer service, and retail workers share up to 71% of the same skills. Adopting skills-based approaches enables companies to discover and engage a more extensive talent pool. These strategies facilitate access to nontraditional applicants, including individuals lacking conventional qualifications on their resumes, and promote opportunities for women and people from marginalized groups. A JobGet analysis, utilizing talent profile data from Lightcast, demonstrates that skill-first hiring can expand the talent pool by a staggering eight times overall. Furthermore, this approach significantly enhances quality by reducing mis-hires by an impressive 92% and boosting employee retention rates by a remarkable 91%.

Navigating the Challenges of Skills-Based Hiring

According to McKinsey, employers often grapple with two primary challenges when considering a skills-based approach: skills validation and effective sourcing. Validating skills, competencies, and references while simultaneously identifying job seekers with the right skills and encouraging their applications can be a daunting task. Notably, 61% of hourly job seekers have expressed that their most significant employment obstacle is finding the right jobs to apply for. This raises an essential question: How can job seekers confidently apply for roles that may differ from their previous experiences?

Transitioning to skill-based hiring undoubtedly offers numerous advantages, but navigating potential pitfalls is essential. Here are some common mistakes organizations should be mindful of:

  • Neglecting Soft Skills: While technical skills are vital, overlooking soft skills like communication and teamwork can lead to a less productive work environment.

  • Inflexible Job Descriptions: Overly rigid job descriptions may discourage potentially qualified candidates. Employers should remain open to applicants with transferable skills.

  • Lack of Standardized Assessment: Failing to establish consistent and standardized skills assessments can introduce inconsistencies in the hiring process. This may result in unfair candidate evaluations and undermine the effectiveness of the skill-based approach.

Making the Jump to a Skills-Based Approach with AI

Incorporating enhancements in job descriptions, such as emphasizing soft skills and recognizing transferable skills while refraining from requesting qualifications when they're not essential, can significantly benefit your hiring process. Additionally, artificial intelligence (AI) plays a vital role in addressing recruiters' challenges. It excels in sourcing by uncovering opportunities for candidates who might not have realized they were qualified. AI can efficiently match job openings with potential candidates, making recruitment efforts more effective and efficient.

Artificial intelligence (AI) offers several ways to streamline and enhance the candidate sourcing process:

  • Resume Scanning: AI-powered systems can quickly scan and analyze large volumes of resumes to identify candidates who possess the required skills, qualifications, and experience.

  • Keyword Matching: AI algorithms can match job descriptions with resumes, identifying relevant keywords and phrases to ensure a higher degree of accuracy in candidate selection.

  • Sourcing Automation: AI tools can search various online platforms and databases to find potential candidates, saving recruiters significant time and effort.

  • Diversity and Inclusion: AI can help identify and promote diversity and inclusion by removing biases in the sourcing process, ensuring a more equitable selection of candidates.

  • Sourcing Passive Candidates: AI can identify and engage with passive candidates who may not be actively job-seeking but could be open to new opportunities.

JobGet is the fastest-growing Social Job Network for Retail, Hospitality, Food Service, and Customer Service workers. JobGet uses AI-powered skills-based matching technology to match jobs to job seekers.

Interested in learning more about how JobGet can help you fulfill your hiring needs? Your next great hire is just a click away!

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