Despite global economic challenges, Thailand's economy continued to show some expansion in the second quarter of 2023, recording a year-on-year GDP growth rate of 1.8%. Although this figure did not meet market expectations, employment also increased by 1.7% in Q2 2023 quarter-to-quarter with the positive performance of several key sectors, including tourism, wholesale and retail trade, and information technology. While the unemployment rate did show a decrease, the ongoing shift towards digital transformation across industries presents challenges for job seekers, particularly those who lack the required skills or previous experience.
As most companies increasingly automate their operations and digitise their business processes, they are seeking candidates with specialised skills to drive and support these technological advancements. This transition underscores the imperative for job seekers to adapt to the evolving requirements of the job market. This also presents a challenge for companies in sourcing experts in the field, as they are facing a talent gap.
In this competitive environment and as the future of work continues to evolve, how companies assess potential candidates and access available talent pool is starting to see a shift. In an environment where employers are identifying skills shortages as a major disruptor to their business strategy, could skills-based hiring be the answer?
What is skills-based hiring?
Skills-based hiring is a shift from “hire for attitude and train for skill” or a focus on degree-attainment to an approach that focuses on “skills first” as a determinant for success.
It places a candidate's skills and competencies at the forefront of the recruitment process. Rather than prioritising a candidate's qualifications, experience, or educational background, it focuses on demonstrated skills and competencies that a candidate has acquired through their work experience or training.
Skills- based hiring is a departure from the traditional recruitment approach, which often relied heavily on educational qualifications, such as four-year degrees and work experience. This approach can often disadvantage individuals who may have relevant skills but lack formal qualifications or experience.
By prioritising skills, companies are able to attract a more diverse pool of candidates who may have skills and experiences that are transferable across different industries. This approach also means that employers can identify candidates who may be a good fit for a role but who may not have the typical educational background or experience that is traditionally required. This makes skills-based recruitment a more inclusive and flexible approach to hiring.
Examples where a skills-first approach has resulted in a hiring win
In Consumer Goods and Services
As the consumer goods sector has matured, it has prompted industry players to shift their focus toward technological advancement with a customer-centric approach. They proactively explore consumer insights to enhance their products and overall customer experience, emphasising the importance of sourcing professionals from related industries, as they are expected to have the skills and experience needed to help these companies reach their goals. Where there may have been a shortage of candidates with a traditional combination of skills and competencies, a skills-based approach has been instrumental in filling roles, as seen in the following example:
Marketing Officer from different industry background – an engineering and paper company in Thailand was seeking a marketing professional from a related industry. Despite having a background in the F&B sector, the candidate possessed other essential skills for the position, particularly in the areas of communication, problem-solving, and negotiations. This candidate was ultimately selected and has made significant contributions to the company's achievements.
In Corporate Services
As industry competition intensifies, back-office positions are increasingly requiring not only technical skills but also skills that can support company growth. In sectors undergoing a digital transformation, companies will prioritise candidates for finance, HR, sales, marketing, and other administrative roles who possess technology skills. While in multinational companies, they mostly look for multilingual professionals as they can facilitate and engage in smooth discussions with surrounding team members. For example:
Finance Controller with a different industry background – a jewelry manufacturing company encountered challenges in sourcing a candidate who had both industry experience and robust English communication skills. The candidate was expected to have experience and a deep understanding of the financial systems in that industry and the ability to have smooth discussions with the team. However, the company decided to hire a skilled professional from a different industry because of his excellent technical, management, and foreign language skills from his previous role as a regional financial controller in a multinational company.
Secretary with previous flight attendant experience – a former cabin crew member with multitasking abilities and effective communication skills was offered the position of Managing Director's secretary.
Sales Administrator with a secretarial background – a sales manager was searching for candidates able to handle multiple tasks simultaneously and deliver compelling presentations to support the sales teams. Despite the lack of experience in sales administration, a candidate who had previously worked as a secretary was hired because of her skills and experience matching the requirements of the role.
Will skills-based hiring ease the perceived lack of a candidate pool?
It’s clear that the status quo in how employees have come to view and assess candidate profiles is due for a shift. In such a competitive labour market environment as Thailand yet where the number of jobseekers only continues to increase, could skills-based hiring be the answer? Jobseekers today also show a desire to upskill and increase their range of knowledge to grow their careers. And with the ubiquity of online learning and government initiatives to support this, opportunities abound for them to do it.
A skills-first approach is a fresh one that can open up a diversified talent pool for those hiring in certain area like Consumer Goods & Services and Corporate Services. It requires the ability and flexibility to look past the most obvious applications of a candidate’s skill sets and the eye to recognise which one of those may be transferrable and successful in another setting, opening up new opportunities for both candidate and client alike.
To learn more about how a skills-based approach could help you discover a wider pool of talent, get in touch with a JAC Recruitment consultant today.