According to ManpowerGroup’s 2025 Talent Shortage report, 76% of employers reported difficulties in hiring due to a lack of skills. The good news is that this number has actually gone down for the first time in about 10 years – in 2024 it was 80%. The bad news, of course, is that it’s still a very big number.

This raises an all-important question: why has that percentage decreased, and why now?

Curiously, it was through an effort to address two other problems that this third one was solved. We’ll take you through these problems, and how tackling them yourself can help to decrease your own skills gap.

Homogenous Workforces

As we have unfortunately seen in recent times, businesses have been backpedalling on their DEI initiatives amidst ongoing cultural controversies. This however, has not changed the fact that, when implemented thoughtfully, a more diverse workforce is better for your bottom line. So, hiring managers have had to take a new perspective on diverse hiring. It was never about making sure you have X amount of employees with Y attribute for every Z amount of people in the business. It’s about creating a wide pool of backgrounds, experiences and perspectives.

So, how do you achieve that on more than just a superficial level? It’s a matter of where you’re hiring from.

We’re all at risk of being dazzled by prestige. Here in the UK, if you have five job applicants and read ‘Oxford University’ on one of their CVs, you’d be forgiven for being tempted to hire them based on that alone. But the truth is that a person’s suitability for a role goes far beyond what university they went to, or even what they learned there; in such a fast-paced working world, adaptability is usually a much more valuable trait than raw intelligence. Even then, the world is wising up to the idea that many people who attended these institutions were more easily able to do so due to their upbringing rather than on merit alone. A person from a well-off family who could support them financially while studying at Cambridge will naturally have a different skillset and work ethic to someone who had to work part-time to pay their rent while they attended a less notable university. This isn’t a criticism of either group, but merely illustrates that the way the Talent Acquisition world is looking at qualifications is changing.

Over in the States, 33% of hiring managers said they’re less likely to hire Ivy League graduates than they were 5 years ago, with 42% saying they’re more likely to hire from public universities. Even PwC is widening its net, with its various recruitment initiatives allowing the firm to hire from over 700 universities and colleges in the US.

This all begins to point towards the notion that hiring is less about the nature of someone’s qualifications and more about their abilities and the perspectives they can bring to the table. Of course, assessing these things is much more difficult than reading a CV. But, recent developments have turned even that age-old tradition upside down…

AI In Job Applications

This is something we mentioned briefly in our last article, but it’s worth paying more attention to it here. The proliferation of generative AI and its ready availability to everyone regardless of means or technical knowledge has – with no exaggeration – changed the world. Debates are thrown back and forth everywhere as to whether that change is for the better or the worse, but the change itself is undeniable.

As you are no doubt aware, the most common usage of tools such as ChatGPT or Claude is to assist with writing. It could be for news articles, university essays or poems – whatever you want to write, AI can help you do it faster and easier. So, it wasn’t long before it made its way into the world of job applications.

Back in the good old days, if you wanted to apply for a job, you took your paper CV over to the establishment in question. You handed it over, perhaps filled out an application form and went away to wait for a phone call. If you really wanted to stand out, you wrote a cover letter explaining why you believed you were such a good fit for the company.

Now, of course, the ecosystem has changed. Job applications no longer require you to leave your house or print anything out, but that doesn’t mean they’re easier. Each application demands a customised cover letter, and most expert advice even tells you to tailor your CV to each company too, rather than simply sticking with a standard one-size-fits-all document. Add that to whatever online application process each company employs, and you have a journey that can take hours just to apply for a single job. Some may say that this is perfectly fine – if you really want the job, you should be willing to put in the work to stand out. In today’s market, however, most jobseekers don’t have the luxury of only applying to the handful of companies that truly appeal to them. So, it's not only unsurprising that many of them turn to AI for help, it’s actually the most effective and efficient way to conduct their job search.

This does, however, create problems for hiring managers. Filtering out what’s been crafted by a human and what’s been generated by a machine is no easy task. Even the tools specifically designed for the job aren’t always reliable and are easy to fool. While most applicants who use AI do so just to bolster or adapt the language of their applications, there’s every chance that a new hire will lack the experience they reported having thanks to ChatGPT’s penchant for embellishment. Now they’re in over their head, and you’re up a certain creek without the required means of propulsion.

So, how can you possibly ensure that applicants possess the skills they say they do?

Skills-Based Hiring

Already, skills-based hiring has become a bit of a buzzword in the recruitment community. We’ve avoided using the term so far in this article because we first wanted to give you the context as to why it has so suddenly rushed to the forefront of the Talent Acquisition world. The practice involves focusing not on qualifications and previous job titles, but a more fluid collection of skills that will add value to the team in a time where job roles are more dynamic than ever.

Shifting your hiring process to one centred around skills rather than experience helps greatly to solve the two problems we discussed earlier. For the first, a person is no longer limited by which opportunities they’ve either been granted or denied in the past and is instead able to prove themselves on their own merit. For the second, it creates a filter that prevents someone from claiming abilities that they don’t possess in reality. Essentially, it takes down an unnecessary barrier and raises it where it’s actually needed. The data says it works, too, with 90% of businesses adopting this model reporting fewer mis-hires, while 94% agree it more accurately predicts on-the-job success.

Changing the structure of your entire hiring process isn’t simple, of course. It requires a huge overhaul from how you source candidates to how you interview and assess them. But, it’s a change that over half of UK businesses are undertaking.

Conclusion

It seems obvious to say that the reason the skills gap is finally starting to close is because employers are starting to focus on finding them. But within that simple statement is a revolutionary twist on the hiring paradigm. Finally, we’re able to streamline an application to look past what a person’s experience implies they can do, and instead actually assess them for that ability.

Making this change is difficult. We certainly wouldn’t suggest it’s something you can do overnight. But, if you’re beginning to explore skills-based hiring or finding yourself at a crossroads in the process, we know just the place where you can get some expert advice. This April, HR Technologies UK will play host to a fantastic collection of businesses who can help you with skills-based hiring. Alongside them in our free-to-access theatres there’ll be leading industry voices to guide you through making this vital adjustment.

Register for free today, and we’ll see you at the show!