Skills-based hiring key to SA skills shortage, aligning with Gen Z – Anne Rutledge, Resourgenix

While South Africa grapples with high unemployment rates, a critical shortage of skilled professionals persists. The Department of Home Affairs’ critical skills list, released in October 2023, highlights the acute demand for business managers, project managers, customer service professionals, supply chain experts, and engineers. Traditionally, these roles have required formal degrees. Anne Rutledge, Executive Director of Talent Solutions at Resourgenix told Biznews in an interview that there is a global shift towards skills-based hiring and it is gaining traction in  South Africa not only in the tech sector but also in finance, administrative, and entry-level positions. Rutledge explained that the move towards skill-based hiring is driven not only by the shortage of critical skills but also by a new generation of job seekers who may not wish to pursue traditional university education. Rutledge offered suggestions on how organisations can implement skills-based hiring practices to unlock untapped potential and stay attuned to the evolving workforce landscape. 

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Extended transcript of the interview

00:00:11:17 – 00:00:32:01
Linda van Tilburg
Skills-based hiring is a growing trend in the global job market. It’s a shift from traditional hiring methods that often prioritize degrees and work experience, and we have Anne Rutledge from Resourgenix to discuss whether this is becoming a trend in South Africa. Hi Anne, and a warm welcome to you.

00:00:32:05 – 00:00:46:07
Anne Rutledge
Hi Linda, great to be back. Yes, and it’s definitely a topic that’s on everybody’s lips at the moment in terms of skills-based hiring and how they take it forward, how they implement it, or even see if it’s suitable for their environment.

00:00:46:10 – 00:00:48:11
Linda van Tilburg
So what exactly is it?

00:00:48:13 – 00:01:13:22
Anne Rutledge
So, skills-based hiring is a term that’s kind of been put together that talks about looking at individuals, not just their qualifications, but rather the whole individual. What experience do they have? Where have they worked previously? What other skills do they bring to the role? It really starts looking at experience rather than qualifications.

00:01:14:00 – 00:01:30:18
Anne Rutledge
It’s a really good method, especially in a country where you’ve got a skill shortage. Looking at people who have the experience but not necessarily the qualification definitely helps to fill those gaps and fill those requirements that you’ve had open for a long period.

00:01:30:19 – 00:01:36:20
Linda van Tilburg
So what is driving it? Is it the skills shortage in some professions?

00:01:36:22 – 00:01:55:19
Anne Rutledge
I’d say that’s a part of it, but I think what’s driven it over the last couple of years, actually, because it’s been around for a while, is that many of the new workforce coming into organizations don’t necessarily have those qualifications. If you think about Generation Z, a lot of them don’t necessarily want to go to university just yet.

00:01:55:22 – 00:02:21:15
Anne Rutledge
They still want to figure out where they’re going and that type of thing. So, it’s been around for a while. But in a lot of instances, what’s happened is that people or organizations have started to understand that there are a lot of individuals out there who, through the natural course of their career, have come across different roles within the organizations, have fulfilled different functions within an organization, and therefore they do have that experience.

00:02:21:17 – 00:02:42:18
Anne Rutledge
You’re overlooking a huge pool of individuals that could be really good for your company if you don’t look at the skills of an individual rather than their qualifications. Obviously, it doesn’t work in every single role. If you’re looking for a chartered accountant, you have to have a qualification, that goes without saying.

00:02:42:18 – 00:03:08:08
Anne Rutledge
Medical doctors need a medical degree. So, it’s not in every role. But definitely when you start looking at your mid-level roles, mid-level to intermediate type of skills, you can look at those individuals who possibly don’t have the qualification, haven’t gone to universities, but have done the work and have the experience of working in that role.

00:03:08:12 – 00:03:12:18
Linda van Tilburg
So is there a reluctance among companies to adopt this, or are they keen?

00:03:12:20 – 00:03:36:00
Anne Rutledge
There’s still some reluctance to it. I mean, if I look at within our organization, about 35% of the roles that we get on a monthly basis do require qualifications. So, you can still see there is a reluctance. I think qualifications generally show organizations that somebody has definitely got the capability to do it. However, it’s changing that mindset.

00:03:36:02 – 00:04:01:09
Anne Rutledge
And it’s going to take a while for people to understand that a qualification doesn’t necessarily mean that you can do the job. It means that you’ve got the theory behind it, but you don’t necessarily have the practical knowledge of how to implement that theory. Being able to assess individuals on their practical knowledge and what they’ve actually delivered in different organizations will definitely set organizations apart.

00:04:01:09 – 00:04:05:09
Anne Rutledge
And being able to find those skills a lot quicker than they are finding right now.

00:04:05:12 – 00:04:13:05
Linda van Tilburg
So if a company says, okay, I buy that, what are the essential steps they should implement for this approach?

00:04:13:06 – 00:04:32:09
Anne Rutledge
So, definitely looking at past experience, looking at where the individual has worked before. What are the projects that they’ve worked on? What are the functions that they had within their roles? These are definitely important. But to qualify that, you obviously need to look at reference taking, making sure that you are getting references from past employers to confirm that type of skills.

00:04:32:11 – 00:04:50:00
Anne Rutledge
There are a lot of skills assessments out there as well that you can use. Different types of skills assessments can be used, whether it is in financials, whether it be in IT, all of that you can test, and you can see if the individual has done it.

00:04:50:02 – 00:05:08:12
Anne Rutledge
A lot of organizations are also using role-play type of interviews where they might ask a candidate to complete certain projects or certain tasks or bring together a portfolio of evidence of sorts of where they’ve done this before. So, there are different ways that you can assess whether the individual has got that experience or not.

00:05:08:16 – 00:05:12:22
Linda van Tilburg
Are some of these skills soft skills that you are considering?

00:05:13:00 – 00:05:38:21
Anne Rutledge
Yes, so I think soft skills play a very important part in any type of role that you’re looking at. Soft skills have become a lot more prevalent in the last couple of years as well. Things like problem-solving. Problem-solving is one of those very important soft skills that organizations often don’t take into consideration, but those are generally the people who can help your organization to move forward.

00:05:39:01 – 00:05:59:13
Anne Rutledge
They are the ones who will come up with ideas, innovation, design thinking, all of that as well, as well as communication skills. Whether you are in finance or information technology, nowadays, you’ve got to be able to communicate with your colleagues. You’ve got to be able to communicate with your project stakeholders at different levels to be able to understand what you’re going through.

00:05:59:13 – 00:06:28:15
Anne Rutledge
So you need that. Analytical skills are another one. We’re taking large amounts of data and being able to analyze it and have a look at what the data is actually telling you. What is the story behind it? If you put all of those three skills together as an example, as an individual, you’ve got a very rounded candidate that could possibly really make a difference in the role that you’re looking for as well.

00:06:28:17 – 00:06:50:12
Anne Rutledge
Not disregarding the experience that they have as well and bringing that into the equation, then you’re really starting to find those gems of resources that you possibly weren’t looking at before because you were limiting yourself to, ‘I need a qualification in this field and I’m not looking at anybody else who doesn’t have that qualification.’ So, it opens up a wide variety of applicants for those roles.

00:06:50:13 – 00:07:04:10
Linda van Tilburg
So, you said for a CA, you need the qualifications or for an engineer, but what kind of professions are we thinking of here? Is it primarily IT and now this new buzzword AI?

00:07:04:12 – 00:07:25:20
Anne Rutledge
So definitely in IT, a lot of IT professionals don’t necessarily have those qualifications. And to be honest, when you go to varsity and study IT qualifications, a lot of that information that you get by the time you leave, some of it has already evolved and moved on. So, you’ve got to constantly re-study things all the time.

00:07:25:20 – 00:07:48:21
Anne Rutledge
So, IT is definitely one of those professions. The others are junior roles, financial roles as well, accounts receivable, accounts payable, controllers, all of those are roles that people have learned and they’ve done, and they’re able to do that. Administrative roles come into play as well. For some reporting analytical types of roles,

00:07:48:23 – 00:08:16:07
Anne Rutledge
people have self-taught themselves on different platforms and can consume large parts of data. When you start looking at sales roles, they do not necessarily have to have some sort of qualification in the back end; they’re able to do that. So, there’s quite a number of roles, a number of categories or job families that have elements of not needing a qualification and having the past practical experience.

00:08:16:08 – 00:08:20:19
Linda van Tilburg
So if you are a job seeker, how do you go about getting these skills?

00:08:20:21 – 00:08:46:22
Anne Rutledge
So obviously, people coming into the world of work right now, especially your Gen Z’s, it’s about being open to new learnings and being open to trying different things within an organisation. Often, when you are a newcomer to an organisation, you come in to do one specific role, but if you put up your hand for multiple different types of projects, ultimately, you learn different skill sets.

00:08:47:03 – 00:09:20:05
Anne Rutledge
So if you are coming fresh/new into the job world, look at different ways that you can contribute to different projects that you can become involved in, so you can learn those new skills. When you are out there as a job seeker and looking for those opportunities or those career opportunities, make sure that you enhance your resumes and your CVs with the projects that you’ve worked on, with all the experience that you’ve worked on. Even if you feel this might not be relevant to this particular job, you never know, that particular skill might be something that they would look for.

00:09:20:07 – 00:09:31:06
Anne Rutledge
So, putting together your skills matrix within your CVs and your resumes is important so that you can stand out amongst the other applicants who apply for those roles as well.

00:09:31:09 – 00:09:48:08
Linda van Tilburg
So we know that a lot of jobs are screened not by humans, but it’s screened long before that with AI. So, is there a way to get past the AI and to actually sit in front of somebody with these kinds of skills that you were talking about?

00:09:48:10 – 00:10:11:06
Anne Rutledge
So, AI is something that is becoming more prevalent and definitely in the recruitment industry, it’s something that is adopted quite widely by a lot of professionals. AI is there to take away the mundane tasks of—if you look at the recruitment industry—bulk CV applications that come in and then it helps screen them out.

00:10:11:08 – 00:10:34:17
Anne Rutledge
However, AI is not going to replace human elements. If I take our organisation into account, we’ve implemented AI automation in terms of ranking CVs according to skills, but it’s still up to the recruiter to have a look at that resume and establish whether it is relevant or not.

00:10:35:03 – 00:10:54:00
Anne Rutledge
AI still has a long way to go. There’s still a lot of training that needs to be done. If I can put it that way, it’s still junior. You’re never going to take away that human element of reading through a CV and being able to establish whether that person is relevant or not.

00:10:54:00 – 00:11:15:10
Anne Rutledge
As an applicant, when you apply for those roles, and if you are trying to get away from those AIs, it’s also about looking at the job requirements and making sure that what you have done and the experience that you have attained, matches those job requirements. Gone are the days where you had one resume and sent that off for multiple different roles.

00:11:15:10 – 00:11:34:12
Anne Rutledge
You’ve got to look at that role and understand, okay, they’re looking for X, I need to make sure that my CV has got X. And then I got that experience at the end of the day. It’s important to match that. So, it does require a little bit more time when you’re applying for roles to just make sure your requirements on your CV match the job requirements as well.

00:11:34:13 – 00:11:43:20
Linda van Tilburg
So if you look at South Africa and the businesses and companies that you work for, which sectors are more open to this and which are more reluctant?

00:11:43:22 – 00:12:12:05
Anne Rutledge
We found in the IT space, they’re more open to skills-based hiring. In your financial institutions as well, they are really open to skills-based hiring. A lot of organisations are starting to look at how they even internally within their internal workforce look at enhancing those skills and being able to hire across multiple different departments and multiple different job functions.

00:12:12:07 – 00:12:49:09
Anne Rutledge
Because people do learn different skills ultimately as well. So, it’s all about internal mobility. The financial institutions are looking at it, the IT institutions, and some of the finance roles as well. We’re finding quite a bit in the finance roles. A lot of people are open to that, and then for more junior type roles as well, that’s becoming more prevalent as well with people looking at not necessarily graduates, but individuals who possibly have got some sort of customer service experience, some work experience—even if it’s only a one or two-year sort of work experience, they feel that they can then

00:12:49:13 – 00:12:55:16
Anne Rutledge
take those skills that they’ve obtained and grow them into different types of skills within the organisation as well.

00:12:55:21 – 00:13:01:13
Linda van Tilburg
So how do you think South Africa differs from the rest of the world in this? Are the adoption rates about the same?

00:13:02:06 – 00:13:23:19
Anne Rutledge
I think in the rest of the world, the adoption rates are higher. In South Africa, we are still in that whole process of understanding what are the different skills, sort of creating that matrix of skills that is important for a job requirement. Some organisations are far ahead and they understand it, and some organisations are starting up on it.

00:13:23:21 – 00:13:42:03
Anne Rutledge
I think if you look at Europe, if you look at the UK, you look at the States, the skills-based hiring has been around for some time. But in South Africa, it only recently started coming to light as more and more important organisations have understood that there is a skill shortage in South Africa.

00:13:42:03 – 00:14:09:22
Anne Rutledge
So, how do we utilise the skills that we have and really allow the people who have got the practical experience, maybe not at the level of somebody with a degree or a qualification, but it can be learned. It can be upskilled. That is also what organisations are trying to do, bringing in the people with 60-70% of the skills and then upskilling them with the balance of the skills that they need to.

00:14:10:01 – 00:14:18:19
Anne Rutledge
Often you’ll find that you don’t need that much upskilling. It’s more finessing that you need to do to be able to get those individuals up to speed again.

00:14:18:21 – 00:14:21:00
Linda van Tilburg
Anne Rutledge of Resourgenix, thanks so much for speaking to us.

00:14:21:03 – 00:14:23:00
Anne Rutledge
Thank you very much, and thanks for having me again.

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