Why it’s time to take a different approach to your hiring

For many employers, the talent squeeze is as real as ever. In Australia, jobs and skills have been at the heart of the national conversation over the last year, culminating in a National Jobs and Skills Summit late in 2022.

When it comes to talent, the data shows a “real urgency” to create a bigger and better workforce, and to create opportunities for more Australians. Though hiring has levelled off in Australia from the highs of last year, some sectors have still seen a significant growth in job postings. The economy also looks to be “in flux” rather than in a direct downturn, and companies in the administrative, utility and retail sectors still have strong competition for talent.

On the employee side, the “intensity” of job seeking has also increased, with seekers sending out +3% more applications compared to 2021.

According to LinkedIn’s chief economist Karin Kimbrough, talent professionals need to think about “future proofing” their hiring strategies. With roles and skills changing quickly, now is the time to take stock of the uncertainty and think about how to grow a resilient and engaged workforce.

Taking a different approach

In a tight labour market, employers will need to take a different approach to talent. LinkedIn’s data shows that skills for the same job have changed by 24% since 2015 and are predicted to change by over 40% by 2025.

With this in mind, Kimborough says that employers need to start focusing on skills and potential first, rather than degrees or experience.

“There are multiple benefits for companies who take this approach,” she says. “It is key to keeping a company’s workforce agile, both for external hiring and when looking for internal talent.”

A skills-first approach will also help employers access a wider talent pool. Career Pathways figures show that companies that hire for skills rather than direct job experience will see a talent pool increase of 9.4x - an invaluable resource in today’s difficult labour market. LinkedIn’s own data suggests that skills-first hiring is likely to become a priority in the future, with 44% of LinkedIn hirers explicitly using skills data to fill their roles.

Employee retention also continues to be a major concern for employers. To boost a retention strategy, Kimbrough says companies need to strongly encourage internal mobility, as the chance of retaining an employee jump from 50% to 76% if they have made an internal move.

“Career advancement is a priority for talent,” Kimbrough says. “Going forward, employers who provide employees with opportunities to advance internally will have an edge with retaining diverse talent.”

Finally, flexible working opportunities and equity are quickly becoming a must-have. LinkedIn Australia’s Future of Recruiting Report found that flexibility is the most important factor for Australian candidates considering a new role (75%), followed by compensation (57%).

A skills-based approach will also increase female representation in the workplace and will give employers access to a broader age demographic. This means younger workers graduating in a tough economic climate will find it easier to kick-start a meaningful career, and employers including Gen Z in their talent pool will find it increased by 10.8x.

“We know the future of work is one where an emphasis on skills and a focus on flexibility can keep us moving forward,” Kimbrough concludes.

“Focusing on skills over credentials and pedigrees has the potential to dramatically expand economic opportunity, with strong implications for equity.”

Explore more of LinkedIn’s Economic Graph data and insights here or contact us to discuss how LinkedIn can support with your skills-first strategy.