Skills-Based Hiring: How to Configure Your ATS for Better Matching

Skills-based hiring focuses on what a candidate can do, using job-relevant capabilities and evidence rather than relying only on degrees, job titles or years of experience. For recruitment teams, the approach can widen the pool while making shortlisting criteria more specific.

The shift is timely. Jobs and Skills Australia’s 2025 report says generative AI is more often augmenting work than replacing it, increasing demand for digital literacy and human skills. Globally, the World Economic Forum estimates that 39% of workers’ existing skill sets will be transformed or become outdated between 2025 and 2030. These findings are directional, not a forecast for every Australian role.

What skills-based hiring means for an ATS

A skills-first process does not remove qualifications where they are legally or operationally required. It separates essential credentials from capabilities that can be demonstrated through experience, work samples, structured questions or assessments.

The OECD reports that skills-first approaches may improve job matching and broaden access, while warning that validating skills and building trust in non-traditional credentials remain practical challenges. An ATS should therefore support consistent evidence and review, not simply add a longer list of keywords.

Five steps to build a skills-based hiring workflow

1. Define the work before the profile

Start with the outcomes the role must deliver. Convert each outcome into a small set of observable skills, then identify acceptable evidence. Keep licences, registrations and mandatory qualifications separate so they are not confused with preferences.

2. Use a consistent skills language

Standardise skill names and definitions across jobs, candidate profiles and reports. Jobs and Skills Australia’s National Skills Taxonomy work highlights the value of a common language for connecting jobs, qualifications and experience. Without consistent labels, reporting and matching can become fragmented.

3. Structure candidate evidence

Capture where a skill was demonstrated, the context, recency and level of proficiency. Allow recruiters to record transferable evidence from employment, projects, training or community experience rather than treating a résumé keyword as proof.

4. Apply the same assessment framework

Use structured screening questions, work samples or interview scorecards tied to genuine job requirements. The Australian Human Rights Commission recommends assessing applicants consistently against selection criteria and documenting reasons. Provide reasonable adjustments where required and keep accountable people involved in decisions.

5. Measure outcomes, not only activity

Track progression rates, quality indicators, candidate feedback and early retention by role. Review whether particular criteria exclude capable applicants without improving outcomes. For related governance checks, see Jobli’s guide to responsible AI recruitment: https://www.jobli.io/news/responsible-ai-recruitment-australia.

Common skills-based hiring mistakes

• Creating an unmanageable list of skills instead of prioritising what matters.
• Replacing degree filters with untested automated scores.
• Using different definitions or rating scales across recruiters.
• Treating self-reported skills as verified evidence.
• Failing to update criteria when the role or workflow changes.

A staged rollout is usually more practical than redesigning every vacancy at once. Begin with one role family, agree on the skills and evidence, train recruiters and hiring managers, then refine the process using outcomes.

Support better matching with connected recruitment data

Jobli brings candidate records, communication, workflows, automation and reporting into one recruitment platform. To explore how Jobli can help your team structure candidate information and streamline skills-based hiring, request a tailored demo at https://www.jobli.io/book-demo.

Frequently asked questions