Skill-Based Hiring & AI: How NZ Employers Can Win the Talent Crunch in 2025

In 2025, New Zealand businesses are navigating a complex hiring environment. While some sectors still face skill shortages – particularly in IT, trades, and healthcare – employers and recruiters are now contending with an overabundance of applications in many other fields. It’s a candidate-rich market, but not necessarily a skills-rich one. Sifting through large volumes of CVs to find the right person is more challenging than ever.

Traditional recruitment methods are struggling to keep up. That’s why many forward-thinking employers are turning to skill-based hiring strategies, supported by smart AI tools and expert recruitment partners like Adecco New Zealand.

Understanding the Talent Crunch in Aotearoa

While skill shortages persist in technical areas, many roles now attract a flood of applicants. Administrative, customer service, and entry-level roles often receive hundreds – if not thousands – of applications. But quantity doesn’t always mean quality.

Reports show that 85% of New Zealand organisations are experiencing moderate to extreme skills shortages in specific sectors. At the same time, automation and AI are reshaping roles faster than ever, requiring continuous upskilling and new hiring approaches.

Learn more: Navigating a Candidate-Rich Market

What is Skill-Based Hiring?

Skill-based hiring means placing more emphasis on a candidate’s abilities and competencies rather than traditional markers like university degrees or previous job titles. It helps broaden the talent pool, reduce bias, and better match candidates to the actual demands of a role.

For example, a logistics coordinator may not need a formal qualification if they can demonstrate supply chain knowledge, attention to detail, and tech proficiency. In a fast-changing job market, proven skills matter more than ever.

In a candidate-rich market, skill-based hiring is essential for identifying the few candidates who truly have what it takes.

The Role of AI in Recruitment

Artificial Intelligence tools are transforming how employers source, screen, and shortlist candidates. From analysing CVs to assessing soft skills through behavioural testing, AI brings speed and efficiency to the hiring process.

But AI is only part of the solution. Without human oversight, it can unintentionally reinforce bias or overlook qualities that make a great team fit. That’s why Adecco blends AI insights with experienced consultants who understand your business and your values.

Explore: How to Prepare for an Interview as an Employer

Benefits of Skill-Based Hiring

• Wider talent pool – Opens doors for career switchers, self-taught professionals, and underrepresented groups.
• Future-ready teams – Focuses on adaptability, problem-solving, and soft skills that thrive in change.
• Faster hiring – AI tools speed up screening so roles are filled faster, reducing business disruption.
• Better retention – Employees who are hired for the right skills and cultural fit are more likely to stay.

This approach also supports Diversity, Equity, and Inclusion (DEI) goals. By reducing reliance on rigid credential requirements, employers can tap into a broader and more inclusive workforce.

Learn more: The Growing Importance of Soft Skills

How to Get Started with Skill-Based Hiring

1. Audit your job descriptions – Remove unnecessary degree or experience requirements. Focus on tasks and needed skills.
2. Incorporate practical assessments – Use job simulations or real-world tasks during recruitment.
3. Train hiring teams – Help your managers understand and apply skill-based principles.
4. Use the right tools – Partner with Adecco’s recruitment experts who combine AI and human judgement.

Partnering with Adecco NZ

At Adecco New Zealand, we help businesses across the motu attract and retain the best talent. Our team combines local market knowledge, leading-edge technology, and deep recruitment experience to deliver results.

Whether you’re hiring for one role or hundreds, we tailor our solutions to your needs.

Start your journey: Contact Adecco NZ

Final Thoughts

Skill-based hiring isn’t just a trend – it’s the future of work in Aotearoa. As businesses adapt to new technologies and a flood of job applications, it’s essential to rethink how you identify and attract talent.

Partner with Adecco to build a workforce that’s ready for what’s next.