Why skills-based hiring cannot solve UK tech talent shortages

Tech assesses talent by skills, while shortages remain

UK technology employers make substantial use of skills-based hiring: judging candidates on demonstrated capabilities rather than relying mainly on education, qualifications or career history as proxies. Michael Page reports that 85% of technology organisations assess candidates on demonstrated ability, compared with 66% nationally. Michael Page is a recruitment company with a commercial interest in employers investing in recruitment services and practices.

The same research points to a separate problem. Michael Page reports that 59% of technology hiring managers identify limited availability of skilled candidates as one of their biggest recruitment barriers.

The distinction matters. Employers need to identify who can do the work and ensure suitable people become candidates. Better assessment can improve the first task. Candidate availability remains a separate constraint.

Skills-based hiring improves assessment

Technology employers value qualities including creativity, analytical thinking, communication, resilience and adaptability. Skills-based assessment lets employers test these capabilities directly rather than infer them only from previous roles or qualifications.

Michael Page’s research found that 52% of technology hiring managers said skills-based hiring increased fairness and reduced bias. Some 51% said it made matching people to current and future skill needs easier, while 45% said it improved identification of candidate capabilities.

The approach can also influence applications. Michael Page reports that 61% of technology professionals said they were more likely to apply to an employer hiring on demonstrated skills rather than education or career history, compared with the 58% national average.

This connects assessment with attraction, but willingness to apply and availability remain separate issues. An employer can remove unnecessary qualification filters and improve its assessments while a scarce specialist remains uninterested in changing jobs.

The harder bottleneck is access to scarce specialists

Only 38% of technology professionals are actively looking for a new role, Michael Page reports, compared with 50% nationally. A smaller active pool reduces the number of suitable professionals immediately available to enter a recruitment process.

Michael Page identified data architecture, cyber security and business change among the hardest areas to fill. Employers seek specialist knowledge alongside resilience and adaptability.

James Barrett, Managing Director, Technology and Consulting at Michael Page, describes the larger challenge as scarcity of “genuinely high-demand talent” in those fields. He says standout candidates combine specialist expertise with the ability to lead change and keep delivering as conditions shift. Barrett speaks for the recruitment company that conducted the research and benefits commercially when employers use recruitment services.

For roles aimed at professionals who are not actively looking, employers may need to approach suitable people and give them a reason to consider moving. This changes how executives should read the hiring funnel. Better conversion among existing applicants affects only people already in the process. For scarce roles, the size and quality of the reachable candidate pool can be the main constraint.

Scarce talent makes persuasion part of recruitment

Barrett argues that employers seeking scarce specialists need a clear employee value proposition, credible leadership and an opportunity worth taking a risk on. These are practitioner recommendations from Michael Page rather than independent evidence that a particular recruiting model produces better outcomes.

Barrett also says recruitment partners can reach candidates that businesses may struggle to access alone. Michael Page sells recruitment services, so it has a direct commercial interest in that claim.

The availability figures point to a narrower management implication. When a large share of technology professionals are not actively searching, candidate engagement can start before an application. For CEOs and CTOs filling hard-to-staff teams, assessment quality addresses only part of the hiring problem. Reaching suitable professionals and giving them a reason to engage require separate work.

AI is becoming part of capability assessment

Michael Page also reports substantial AI use in technology recruitment. Half of technology hiring managers said they would be more likely to hire a candidate they believed had used AI well. Some 72% said they use AI themselves in recruitment.

Technology employers reported several specific recruitment uses:

Michael Page reports that only 18% of technology hiring managers said they found it difficult to tell whether candidates had used AI in an application, compared with 28% nationally.

Barrett argues that the relevant issue is whether AI is used transparently and effectively. That is his interpretation as a Michael Page executive. The survey finding is narrower: for those employers, effective AI use can strengthen a candidate’s case.

Key takeaways for leaders

• Skills-based hiring improves assessment: Assessing demonstrated capabilities can reduce reliance on qualifications and career history, with 52% of UK technology hiring managers reporting greater fairness and reduced bias. Employers should test the skills that roles actually require.
• Scarce specialists remain the main constraint: Only 38% of technology professionals are actively seeking a new role, while data architecture, cyber security and business change are among the hardest areas to fill. Leaders hiring for scarce skills should treat candidate access as a separate challenge from assessment.
• Recruitment must persuade passive talent: Reaching specialists who are not actively looking requires more than an efficient application process. Employers should strengthen their employee value proposition, leadership credibility and reasons for candidates to consider moving.
• AI is becoming part of capability assessment: Half of technology hiring managers say effective candidate use of AI would make them more likely to hire, while 72% already use AI in recruitment. Leaders should define how appropriate, transparent AI use will be assessed in both applications and hiring processes.