When Everything Is a Skill, What Actually Matters?

From qualifications to skills, and from skills to priorities

The European Commission has made skills a central part of its competitiveness agenda through the Union of Skills. Its objectives include supporting people in regularly updating their skills and enabling companies to recruit, develop and retain the capabilities they need (European Commission, 2025).

The OECD goes further in its 2026 report A Skills-First Labour Market. Skills-first approaches should not stop at recruitment. The report explores how skills can play a larger role across talent management, career development and training (OECD, 2026).

That significantly expands the role of skills inside an organisation. It also makes prioritisation more important.

Once skills become part of workforce planning and development, HR and L&D need to decide where limited time, attention and development budgets should go. A comprehensive skills taxonomy may provide greater visibility into the capabilities that exist across a workforce. It does not automatically tell an organisation which capabilities are most important for executing its strategy.

That distinction separates a skills inventory from a skills strategy.

The skills landscape is not standing still

Prioritisation becomes harder because organisations are making these decisions against a moving backdrop.

Cedefop's 2026 Skills Forecast projects how employment across Europe could develop up to 2035. Digital transformation, demographic ageing and the green transition are expected to reshape demand across sectors and occupations. Its latest projections point to particularly strong demand for highly skilled occupations, including managers, professionals and associate professionals (Cedefop, 2026).

The World Economic Forum's Future of Jobs Report 2025 provides another indication of the pace of change. Employers surveyed for the report expect 39% of workers' existing skill sets to be transformed or become outdated between 2025 and 2030. Analytical thinking remains the most frequently cited core skill, while AI and big data, networks and cybersecurity, technological literacy, creative thinking, resilience and leadership are among the skills expected to grow in importance (World Economic Forum, 2025).

These forecasts provide useful signals. But they are not ready-made development strategies.

A financial-services company undergoing digital transformation, an industrial business changing its leadership model and an organisation struggling with cross-functional collaboration may all operate within the same broad labour-market trends. The capabilities that are critical to their success can still be very different.

Generic lists of “future skills” can show organisations where change may be happening. They cannot determine which capability gap is most consequential for a specific business.

Where skills-first gets difficult

The more precisely organisations map skills, the more complex the picture can become.

Skills taxonomies can contain hundreds or thousands of individual capabilities. New technologies create new requirements, existing roles evolve and adjacent skills overlap. Greater visibility is useful, but it creates a prioritisation problem of its own.

If everything can be described as a skill, which skills should an organisation actually invest in?

External forecasts cannot answer that question on their own. They can show where labour markets and occupations are moving and help organisations identify developments they should not ignore. But a skill that is increasing in importance across the economy is not necessarily the capability creating the biggest constraint inside a particular organisation.

This is an important distinction for HR and L&D. The objective cannot simply be to keep adding emerging skills to an increasingly comprehensive catalogue. Development resources are finite, and not every relevant capability is equally important at a given moment.

From relevant skills to business-critical skills

A more useful distinction is between skills that are generally relevant and those that are business-critical in a particular context.

Consider communication. Few organisations would argue that it is unimportant. But “improve communication skills” says very little about the actual business problem or what people need to do differently.

Imagine instead that an organisation wants to accelerate decision-making across functions. Teams avoid difficult conversations, responsibilities remain unclear and decisions repeatedly move upwards through the hierarchy.

Now the capability question becomes more specific. Constructive conflict, accountability, decision-making and cross-functional collaboration may be particularly important because they enable behaviours that relate directly to the challenge the organisation is trying to solve.

Another organisation could face an entirely different challenge and arrive at a different set of priorities, even if both have “communication” somewhere in their skills architecture.

The useful question is therefore not simply:

Which skills will become more important?

It is:

What needs to change in how people work for us to address the challenges that matter to our organisation?

The relevant skills can then be derived from the answer.

Skills strategy starts with the business, not the catalogue

This reverses a common way of approaching skill development.

Instead of beginning with a catalogue and deciding which competencies employees should acquire, organisations can start with the outcomes they are trying to achieve.

What is preventing progress today? Which groups have a meaningful influence on that challenge? What would those people need to do differently? Which capabilities would make that behaviour possible?

The sequence becomes:

Business challenge → target behaviour → critical capabilities → development → measurement

This also makes it difficult to justify a single skills agenda for an entire workforce.

The same strategic challenge can place very different demands on leaders, specialists, project teams and other employee groups. The capabilities each group needs depend on the role it plays in creating the desired change.

A useful skills architecture therefore does more than describe what people can do. It helps an organisation make choices about what needs to be developed, for whom and for what purpose.

Skills-first is a starting point

The shift towards skills-first thinking addresses a genuine limitation of traditional talent management. Degrees, previous job titles and formal qualifications provide an incomplete picture of what people can contribute, particularly as roles change and people acquire capabilities through increasingly diverse routes.

But replacing credentials with an ever more detailed language of skills does not automatically make workforce development more strategic.

For HR and L&D, the harder task begins after skills become visible: deciding which capabilities deserve attention now, which target groups need them and what should change in the organisation as a result.

That requires organisations to move beyond the question of how many skills they can identify towards a more consequential one: which capabilities are critical to the challenges they are actually trying to solve?

A skills inventory creates visibility. A skills strategy creates priorities.

‍

References

Cedefop. (2026). Cedefop updates Skills Forecast: New data to guide Europe's skills and labour market policy to 2035. European Centre for the Development of Vocational Training.
https://www.cedefop.europa.eu/en/news/cedefop-updates-skills-forecast-new-data-guide-europes-skills-and-labour-market-policy-2035

European Commission. (2025). Union of Skills.
https://commission.europa.eu/topics/competitiveness/union-skills_en

OECD. (2026). A Skills-First Labour Market. Getting Skills Right. OECD Publishing.
https://doi.org/10.1787/2e1b85f0-en

World Economic Forum. (2025). The Future of Jobs Report 2025. World Economic Forum.
https://www.weforum.org/publications/the-future-of-jobs-report-2025/

‍