The skills gap is real, and it’s creating a shift towards skills-based hiring.
As global labor markets shift and digital disruption accelerates, talent teams know they need to build agile, future-ready workforces capable of learning the essential skills of tomorrow.
In response to these changes, a widespread transformation in how talent is identified, evaluated, and hired is underway. Businesses are moving away from evaluating candidates based on inferred and self-reported skills to focusing on validating their actual skills and abilities.
I asked Dr. Mike Hudy, Chief Science Officer at Hirevue, to share his insight into how businesses can address this challenge.
Rieva Lesonsky: Are employers losing confidence in what they see on résumés?
Dr. Mike Hudy: A Skills Report from Hirevue found that 72% of talent acquisition leaders don’t trust the inferred skills outlined on polished resumes and would prefer to make hiring decisions based on validated skills.
This is not surprising considering how easy AI has made it for job seekers to craft resumes and cover letters. It is harder than ever for hiring managers to identify the right candidate for the job based on resumes alone.
Lesonsky: What are employers overlooking when struggling to find candidates with the right skills?
Dr. Hudy: Relying on resumes or self-reported skills from candidates. Hirevue’s report found that 50% of talent acquisition leaders say they have difficulty validating candidate skills, leaving 72% to default to outdated methods like resume screening or self-reported skills from candidates. And importantly, respondents cite widespread “skills fatigue,” where companies are eager for change but plagued by uncertainty and ineffective tools. What’s missing is a reliable way to validate those skills.
Lesonsky: What strategies can employers use to successfully close the skills gap?
Dr. Hudy: The solution is skills-based hiring through direct, structured, scientifically validated assessments that measure not just what candidates know, but what they can do. Companies that adopt validated approaches, such as job simulations and skill-specific assessments, are building more equitable and effective hiring strategies, and they’re reaping the rewards. Forward-thinking organizations that embraced this shift are seeing results:
- 68% report improved quality of hire,
- 62% see a reduction in bias, and
- 74% note higher hiring manager satisfaction.
Effective assessments do more than measure what candidates know—they measure how candidates apply that knowledge in practice. This distinction is crucial in evaluating job-readiness and performance potential.
Companies must move beyond resume reviews, buzzwords, and surface-level signals into a skills-based hiring model that actively evaluates, proves, and trusts in real capability. The companies that commit to this level of clarity and rigor will not only hire better—they’ll build teams with the resilience and readiness to thrive in an unpredictable world.
Before we go further, it’s worth stepping back to understand what’s really driving the skills gap. I asked John Woods, Ph.D., Provost & Chief Academic Officer, at the University of Phoenix, and Founding Director of the university’s Career Institute®, to share his perspective.
Lesonsky: What’s driving the skills gap?
John Woods, Ph.D: What we call the ‘skills gap’ is often less a shortage of talent and more a mismatch between how quickly work is changing and how quickly organizations are developing people to keep up.
Technology, particularly AI, is accelerating that shift. The World Economic Forum found that 63% of employers now see skills gaps as the leading barrier to business transformation, and that nearly 40% of workers’ core skills are expected to change by 2030.
What we’re seeing is that roles are evolving faster than traditional education and talent systems were designed to adapt to. Employers increasingly need people who can apply knowledge immediately, solve problems in real contexts, and continue learning as their jobs evolve.
So, the challenge isn’t simply finding talent. It’s about building clearer pathways that connect learning to the realities of work and helping people continuously update their skills over the course of their careers.
Lesonsky: What are employers overlooking when struggling to find candidates with the right skills?
Woods: Employers often assume the problem is a lack of talent. In many cases, the real issue is a lack of pathways for people to build the skills employers need.
Many businesses still default to hiring externally when they need new capabilities. University of Phoenix’s 5th annual Career Optimism Index® study found that 60% of employers prefer hiring new employees over training current staff, even as 86% of workers say they are actively seeking skill development opportunities within their existing organizations.
That disconnect can create frustration on both sides. Employees want clearer opportunities to grow, while employers struggle to fill roles quickly enough through outside hiring alone.
Another factor is that employers sometimes underestimate transferable skills. Workers may not have held the exact job before, but they often have adjacent capabilities that can translate quickly with the right support.
In many cases, the real opportunity for employers is not simply expanding where they recruit from but strengthening how they develop the talent they already have.
Lesonsky: What strategies can employers use to successfully close the skills gap?
Woods: The employers making the most progress tend to treat learning as part of their workforce strategy rather than something that happens only before someone is hired.
One effective approach is stronger collaboration between employers and educators. When employers help inform curriculum—through advisory partnerships, applied projects, or simulations—students graduate with experience solving the kinds of problems they’ll encounter on the job.
Another strategy is expanding work-integrated learning. Apprenticeships, internships, and other structured work-based models allow employees to build skills in context while contributing productively. U.S. Department of Labor data shows that more than 90% of apprentices remain employed after completing their programs, highlighting the effectiveness of learning-through-work models.
Finally, many businesses are investing more intentionally in continuous learning for their existing workforce. As technology reshapes roles, employees need opportunities to update their skills throughout their careers, not just at the beginning.
Closing the gap isn’t about finding perfect candidates. It’s about building systems that help people develop the right skills over time.
Rieva Lesonsky is the founder of Small Business Currents, a content company focusing on small businesses and entrepreneurship. You can find her on Twitter @Rieva, Bluesky @Rieva.bsky.social, and LinkedIn. Or email her at Rieva@SmallBusinessCurrents.com.
Photo courtesy Getty Images for Unsplash+