Skills and labour shortages are two of the most pressing concerns facing societies and economies today. The impact on businesses, for example, is immense. PwC’s latest Annual Global CEO Survey found that 52% of CEOs believe labour and skills shortages will significantly impact profitability in their industry over the next 10 years. These talent shortages come at a particularly critical time for businesses, with many of them challenged with reinventing their business models in response to a range of external and internal drivers ranging from economic and geopolitical uncertainty to stakeholder and competitive pressures.

The World Economic Forum’s latest Future of Jobs Report 2023 finds that organizations across all industries identify skills gaps and an inability to attract talent as the key barriers preventing industry transformation. And the situation seems likely to get more acute, as businesses race to fill what the World Economic Forum has described as the jobs of tomorrow.

This report highlights one key element of a potential solution. A “skills-first” approach to hiring and developing people has the potential to transform the way that labour markets operate, delivering significant benefits not just to business, but to our wider society and economy.

A skills-first approach focuses on whether a person has the right skills and competencies for a particular role, rather than having the right degree, job history or previous job titles. It means that businesses get the skills they actually need for a particular job, but more than that, it democratizes access to good jobs for those people who have the competencies but not the right formal qualifications for a role.