Empowering the Workforce in the Context of a Skills First Approach

The OECD’s report, “Empowering the Workforce in the Context of a Skills‑First Approach”, examines the growing move in labour markets towards valuing demonstrated skills over traditional credentials like degrees or job titles. This shift is driven by rapid changes such as technological progress, demographic shifts, and the rise of sustainability-related work, all of which are reshaping skills demand due to labour-shortages in those highly specific fields.

Individuals are increasingly signalling their skills online. Between 2018 and 2023, both the share of users adding skills and the number of skills listed grew significantly. While industry and business skills remain most common, transversal skills and disruptive tech skills are growing fastest. Young people lead in signalling emerging skills, older workers tend to list a broader range. Women tend to highlight digital skills, while men more often signal green job skills. 

Employers are increasingly adopting skills-based hiring, focusing on what candidates can do rather than their formal education. Labour shortages are accelerating this trend, especially among large companies and public employers who are removing degree requirements and using digital tools to assess skills. While this approach expands access and values diverse learning paths, it also brings risks, such as bias in automated tools, reduced long-term adaptability, and weaker worker protections, if not carefully managed.

The report stresses the need for coordinated public policy to support this shift. Priorities include standardising skill validation, expanding lifelong and digital learning, improving labour market data, and promoting skills-based hiring in the public sector. Governments should also help employers build HR capacity and provide career guidance, particularly for vulnerable groups like youth and older workers.