Australian employers shift towards skills-based hiring

Australian employers are placing greater weight on skills and cultural fit than on CVs, qualifications and previous employers, according to Michael Page's latest Talent Trends research, which points to a shift towards skills-based hiring.

The survey found that 25% of Australian employers now prioritise demonstrated skills over career history and education, while 61% give those factors equal weight. Around one in six plan to move to a skills-first approach.

Among employers already hiring that way, 97% reported clear benefits. Half said it helps them identify ability more effectively, while almost one in two said it provides clearer criteria for assessing candidates.

The findings also suggest jobseekers are responding to the change. More than half of Australian candidates said they are more likely to apply for a role when a job advert leads with skills rather than credentials.

The CV shift

Artificial intelligence is one factor behind the changing view of applications. Michael Page found that 67% of Australian jobseekers now use AI to improve their CVs, while 34% of hiring managers said they cannot reliably tell whether an application was written by a person.

On the employer side, 57% of hiring managers are also using AI during recruitment. That has reduced the value of a polished written application as a way to distinguish one candidate from another.

David George, Senior Managing Director at Michael Page Australia, said employers are no longer impressed simply by a recognisable name on a CV.

"For a long time, a stint at a big-name firm was shorthand for quality, you'd worked there, so you must be good. That's no longer the case. The question has shifted from 'who did you work for' to 'what did you learn there, and what can you do with it?'" George said.

He said the emphasis is moving towards judgement, communication and adaptability.

"Skills-based hiring is choosing people for what they can do and keep learning, rather than where they trained or who they trained under," George said.

"Specialist technical skills remain hard to find, but employers say a CV full of big names is no longer enough. They're focusing on what machines can't guarantee, how you work with others, how you handle a curveball and how you communicate in difficult situations."

Interviews matter

As written applications become more standardised, interviews are taking on greater importance in the hiring process.

"The traditional job application we once knew is now over. CVs are now so uniformly perfect, it tells employers almost nothing about the person behind it," George said.

"Combined with the fact that a prestigious employer on your résumé no longer opens the door on its own, the interview is now doing the heavy lifting. That's where real personality shows up."

The wider report points to a labour market in which workers are also making choices based on conditions rather than pay alone. In Australia, 61% said they would turn down a promotion with a salary increase to protect their wellbeing.

That was above the global level of 50%, the survey found. It also showed that 60% of Australian workers would start looking for another job if their employer required them to spend more time in the office.

Other indicators suggest retention pressures remain tied to workplace experience. Some 38% said good relationships with colleagues matter to them, while 45% said they had nearly quit on their first day because of poor onboarding.

Hiring response

Michael Page said employers can widen applicant pools by rewriting job adverts around expected outcomes rather than formal titles. Businesses should also test decision-making through scenario exercises and structured interview questions instead of relying on the presentation quality of CVs.

The recruiter also pointed to salary transparency and onboarding as factors affecting attraction and retention. Half of employers globally with transparent pay structures said hiring had become easier over the past year, while almost half of active Australian jobseekers currently work in organisations without transparent pay.

The Talent Trends report surveyed more than 60,000 professionals across 36 markets, including nearly 2,500 in Australia.