UK employers are rapidly moving towards skills-based hiring as traditional recruitment criteria such as degrees and past job titles fall out of favour, a report has found.
According to The State of Skills-Based Hiring 2025 report by TestGorilla – based on a survey of 1,076 jobseekers and 1,084 hiring professionals around the UK and the US – 77 per cent of UK employers now use skills tests to assess candidates.
This hiring model places a stronger emphasis on candidates’ real-world abilities than their academic credentials or previous job roles.
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The evolution of skills-based hiring
The study revealed that lacking soft skills often leads to underperformance at work. Three quarters of UK employers admitted to hiring technically skilled individuals who later failed to meet expectations because of weak interpersonal skills or misalignment with company culture.
Karen Camilleri, managing director of Camilleri Appointments, said that, as a specialist transport recruiter, she has observed an increasing tendency among her UK-based clients in the rail and bus sectors towards skills-based recruitment.
“There has been a real demand for key skills overseas, in particular the Middle East, Canada and Australia, which has meant that there is a real deficit in the UK as many of the experienced candidates have moved overseas for higher pay and to be involved in large-scale programmes of work with heavy and committed investment,” she explained.
Camilleri added that a focus on skills-based recruitment was also a way of encouraging diverse thinking from an organisation and clients were “rapidly” recognising this and moving away from the previous trend of sector-based hiring.
Skills testing boosts hiring satisfaction
The report found that 69 per cent of employers now include soft skill evaluations in their hiring processes, with 60 per cent acknowledging a growing emphasis on these traits over the past five years.
Researchers also revealed that 85 per cent of employers used skills-based hiring methods, up from 56 per cent in 2022, and the same proportion (85 per cent) of UK employers were satisfied with hires made in the last 12 months, with higher satisfaction (89 per cent) among those using skills tests.
Additionally, employers said skills tests reduced hiring costs (57 per cent) and mis-hires (66 per cent) and improved retention (62 per cent).
Wouter Durville, CEO and co-founder of TestGorilla, said: “In a hiring landscape shaped by uncertainty and rapid change, traditional signals such as CVs, degrees and gut instinct no longer cut it. Employers are under pressure to close skills gaps while making fewer, more strategic hires.
“That demands greater clarity than ever on what candidates can do, and whether they have the right skills to succeed.”
He added that the findings confirmed what forward-thinking organisations already knew: “Skills-based hiring is not just fairer, it’s smarter. It reduces mis-hires, improves retention and is much better than traditional methods at predicting job success.”
Looking beyond qualifications to the whole individual
TestGorilla’s research also revealed that 86 per cent of jobseekers and 77 per cent of employers felt that evaluating the whole person, including soft skills, personality and cultural fit, led to better results.
Meanwhile, a separate study by Totaljobs highlighted the flaws in traditional hiring processes. Despite an average of 22 candidates per role, half of the applications never made it past the first screening stage.
When asked about the reasons for rejecting applications, 70 per cent stated a lack of relevant skills and more than half (58 per cent) cited a lack of relevant work experience.
AI enhances recruitment
AI is playing a central role in driving the transition to skills-based hiring. According to the report, 61 per cent of UK employers now use AI in their hiring processes, and 97 per cent of those said it had improved their hiring processes.
In tandem, 50 per cent of UK organisations have eliminated degree requirements from job postings, up 28 per cent from the previous year. This aligns with previous findings from HireVue, which showed 54 per cent of UK companies planned to move towards skills-first hiring.
Despite these technological advancements, the report highlighted ongoing challenges: 67 per cent of UK employers said it was harder to find top talent than it was last year, while 72 per cent of jobseekers reported that landing a job had become more difficult.
For more information and resources on recruitment, visit the CIPD’s website
