Skills-based hiring and the future of the workplace

Changing dynamics and the future of work

With the dynamic between employers and employees rapidly changing, what will the future of work and our relationship with it be by the year 2050? Will skills-based hiring and skill-based organizations shape job evolution? Will skills-based recruitment become the norm?

CEO Marissa Geist spoke to Kate Bravery, corporate psychologist and leader of Mercer’s thought leadership councils, which supports companies in preparing for the future of work. Read highlights of their conversation with wide-ranging insights into skills-based recruitment- from episode 4 of “The talent time machine” podcast.

Editor’s note: This interview has been edited for clarity and brevity. 

What will jobs look like in 2050?

Will jobs still exist or will skills-based recruitment result in people working for a range of different employers?

Kate: As a psychologist, I trust that we will have gotten better at matching work to the person's skills and aspirations. I’ll paint a vision of the future, and then we can debate it.

I can imagine being woken up by my smart device telling me that I've been matched to a brand new, exciting job, not based on the skills that I have but on what jobs I want to be doing in the future. I also hope that it might be associated with “jobs for good”, contributing to ESG.

And when I get to the interview, they've scraped my digital footprint and have a view of what I like and how I'm going to work; I might find out that the job is actually already in my current firm. And maybe generative AI has transformed the work so much I can be paid the same to only work three days a week. Wouldn't that be wonderful?

How do we get to this future with a digital footprint where we passively receive and accept work from skill-based organizations via skills-based hiring?

Kate: My vision of the future has a real data-led approach to matching individuals to work, a real openness to putting non-traditional talent into roles based on skills they want to develop. And it also has a vision of returning some of these productivity gains that we're seeing to workers. Maybe that's more what I hope 2050 will feel like rather than what it will be!

The dynamic between the employer and the employee has changed rapidly since the pandemic. And in some ways, the genie’s out of the bottle now. And so there will be people who want to contribute to multiple jobs and have side gigs and maybe have more time for leisure or gearing up for retirement.

There are some leading companies doing that. Probably the poster child for this is the UX program at Unilever, where people have a minimum fixed wage, but also benefits and protection, whilst they can actually work for competitors.

Marissa: I feel in some ways, we already do. The average tenure of work has changed and now there’s no career for life. And when I think about my children when they’re online, they’re already maintaining multiple conversations with people, switching between games, switching between mindsets, and doing work in multiple places as a matter of course, so I can't imagine that they won't take some of that into life.

This idea that you exist for your employers has gone already. You aren't who you work for anymore. And by the time my 8-year-old gets into the workplace, the idea that you stick with one employer is going to seem so far away.

How are attitudes to work changing?

Will people become less open to the current concept of work in a future of skills-based hiring?

Kate: Everybody's perspectives about how much time they want to spend at work have changed post pandemic, where we had this period of introspection. The lifestyle contract that people are now looking for really has peaked.

We also see traits with the younger generation. One, they also want to work for a company that they respect and share some values with. We did some research recently that showed they're more likely to be engaged when there's an opportunity to work on the environment and other things that they feel our generation has failed at.

There’s been a lot of data recently showing that these younger generations aren’t as ambitious. But our data shows that's not the whole truth. They're not ambitious in the ways that generation X was. But that world doesn't exist. There aren’t those big hierarchical organizations anymore. I believe success in the future of work will be more about schools, and skills will be the true currency of work, which enables you to move up and change. I think they’re ambitious, just in different ways, and more creative ways.

But I do think the one downside about these agile ways of working is that sense of belonging. We’re already beginning to see that, psychologically, people aren't thriving as much as they would like to be.

Marissa: We’re definitely seeing that too. And we're seeing an uptick in requests for employee value propositions, which is a proxy for people wanting to belong to an organization or a culture or a society that doesn't define them like it used to.

There’s a crossover that we haven't seen before of social stance and corporate culture. We’ve observed how different companies have navigated that to create a sense of belonging. A company like Patagonia that says, “I support the preservation of nature and the outdoors. I'm taking a stance and making it part of my value proposition.”

We're seeing that community, that sense of purpose and identity, needing to be very forefront of companies. As kind of a prerequisite of recruitment, a pre-interview to the interview, with people thinking, “I'm not going to engage with a company if I don't know where they stand on different issues.”

Any parting thoughts around skills-based recruitment and skills-based organizations to consider as we head toward 2050?

Kate: Firstly, if we're going to have skills-based organizations, we need to fill them with the right skills and visibility of those skills. So, make sure that you really understand what skills you have in your workplace today, and that the skills in your contingent workforce and your permanent workforce are visible together. We should also be challenging execs to say, “where are we going to be in three or five years?” Because if execs aren't clear, it's really tough to get that view of skills in the future and start to plot pathways.

Secondly, we need to start to evolve our talent processes. We can evolve our skills knowledge with external intelligence to know what skills are going up and down in cost in the market, develop our thinking around pay for skills in the talent marketplace, and maybe how jobs can be done differently. We can think through a skills lens, and how they can be amplified by talent and artificial intelligence.

Third is the mindset and the skill set of managers to really unlock people's potential. And it does require a whole different way of leading and partnering with our workforce. If people don't want to be employees, but want to be contributors, that demands us to think differently. So, it’s about having intelligence and insight, and changing operating models so we can flex and move people more fluidly around their opportunities to work. But it also comes down to not losing that human connection. Without that, I think people aren’t inspired by the work they're doing, or the role they can play in the future of our organizations.

Marissa: So much to think about. What a great discussion with some fabulous insights into skills-based hiring that will challenge all of us whose work is the world of work itself. I'll be fascinated to see how skills replace roles in the future, and what it will take not to miss this opportunity for work to be more equitable and inclusive.