But the practice is outdated and riddled with bias. 

Research consistently shows that in the few seconds it takes for a hiring manager to scan a CV they have already judged the candidate based on irrelevant (to the role) information like their name (with non-white-sounding names at a disadvantage) and home address. 

Meanwhile, those with employment gaps or looking to side-step into a new industry are all too often overlooked.

How skills-based hiring works

Research shows that skills-based hiring is on the rise, with 63% year-on-year growth, but the world’s largest book publisher, Penguin Random House, was way ahead of the curve.

As of 2017, the publishing house, which employs people across 20 countries, has assessed over 20,000 candidates through anonymized skills-based tests, instead of the conventional CV and cover letter requirements.

An example of a skills-based test question is something like: “It’s 5 p.m. on a Friday and you have these five tasks to do but you can only do three; which would you work on?”

“That’s a situational judgment test, which allows us to infer the thinking process and the behaviors of the person,” says Khyati Sundaram, CEO of recruitment platform Applied, who works with Penguin to hire its interns.

“That particular question is testing for prioritization and communication.”

The answers are then anonymized, randomized, and rated by a panel of hiring managers to prevent any bias. 

By testing candidates on how they would handle the actual day-to-day responsibilities of a role, employers are more likely to hire the best person for the job instead of being drawn by big names and snazzy titles.

As Sundaram points out, just because someone has listed on their résumé that they’ve worked with the SEO team at somewhere alluring like Google, it doesn’t actually mean they know the ins and outs of search engine optimization to the extent that’s required for a role. 

“We are trying to make sure the test or the question is as relevant to the job as possible, and that’s the reason that candidates love it too,” Sundaram says. “They see that it is really relevant to the role, as opposed to writing and sending out the same cover letter, but having to spend 20 minutes tweaking it for every employer.”

It takes candidates longer, yet increases engagement

Even Sundaram admits that she’d intuitively assume that taking multiple skills-based tests would feel like more of a nuisance for candidates than simply blasting their CV at hundreds of roles. “But the data shows otherwise,” she says.

Plus, for candidates who are often overlooked, skills-based testing finally offers them a fair shot at bagging their dream job.

For example, Applied data reveals that the number of women hired into senior roles increased by almost 70% when candidates were asked role-specific questions.

Of the 2,260 candidates they hired into senior roles following a skills-based interview, 52% were women. This is a 68% increase on the global average, where women account for just 31% of senior positions.

“So it is about equalizing the playing field, making sure people have access to the workforce that would otherwise not be possible,” Sundaram insists.