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Limitations of Applicant Tracking Systems

Olivia Jones, Oct, 5 2021 | 5 min read

  

Does your organization use an applicant tracking system (aka an ATS) to review and hire candidates? ATSes are a type of software growing in popularity across multiple industries. Companies use the software to make their hiring processes more efficient, and to deal with large volumes of applicants for a single job posting. But unfortunately, applicant tracking systems also come with some serious disadvantages. Especially in today’s job market, when companies are unable to find or keep qualified candidates, and with many current employees reporting that they may resign very soon, it’s more important than ever that companies make thoughtful hiring decisions. This means reevaluating whether ATSes are truly as helpful as they seem on the surface.

Two Simultaneous Challenges

On one hand, it certainly makes sense that teams use any tools at their disposal to find qualified candidates. There are currently far more job openings than job seekers, which means that companies are becoming desperate to fill openings that have been vacant for months. But relying on an ATS alone won’t solve the current employment crisis, and in fact, it may be contributing to your hiring challenges.

Companies are also facing another serious employment issue: a startling and disheartening lack of diversity, especially in upper management and board positions. As racial injustice continues to be brought to light, many are waking up to the fact that diversity in the workforce is not only morally necessary, but also beneficial for morale, creativity, and company longevity. But companies may struggle to hire diversely, often because their hiring practices are unintentionally exclusionary or susceptible to unconscious bias. These two problems feed off of each other, and together perpetuate a serious crisis of high turnover, homogeneity, and mediocrity.

What is an ATS?

An ATS, or applicant tracking system, is a tool companies can use to manage the resumes and profiles of their prospective employees. ATSes allow hiring managers to easily sort through resumes and prioritize certain candidates. Some ATS software comes with artificial intelligence, which can select the most qualified candidates for the job and promote them to the hiring manager. Applicant tracking systems work by eliminating candidates who lack certain qualifications or who don’t fit into rigid categories.

What are some benefits of using an ATS?

There are plenty of reasons the company might choose to use an ATS. One reason is that they can help cut costs. Because you’re purchasing software rather than paying someone for their time, ATSes can be more affordable than hiring managers or recruiters. They are also more efficient than humans, and may not fall victim to some types of human error. HR teams are able to spend their time more effectively by interviewing candidates directly and communicating with potential candidates.

What are some drawbacks of using an ATS?

Despite their benefits, ATSes also involve some serious drawbacks for organizations that are serious about hiring the right candidates. In today’s job market, you can’t afford to exclude qualified candidates from evaluation, especially unknowingly. Here are some of the specific drawbacks of using an ATS during such a competitive employment market.

Impersonal

ATSes work by eliminating or minimizing the human evaluation of applications. This does free up time for HR departments to spend time on more valuable activities. But by swapping out a human touch for an automated system, the hiring process becomes more impersonal. Often candidates who go through a primary ATS evaluation never hear any response or feedback from the company they’re applying to, positive or negative. Because most candidates have no idea that an ATS is evaluating their application, this lack of communication can feel intentional and offensive. Using an ATS eliminates an opportunity to make a human connection with your prospective employees— a human connection that could win over a hesitant candidate.

Missing out on qualified candidates

As we’ve discussed, the employment market is highly competitive right now. Companies are competing for an incredibly small pool of candidates, and candidates are often fielding multiple great job offers at once. If you are recruiting for open positions, you simply can’t afford to turn qualified candidates away without thoroughly evaluating them first. ATSes can cause your team to pass right by candidates who might be great for your organization. Like any technology, ATSes are fallible, and they rely on pre-set parameters to rule candidates in our out of consideration. If someone is highly suited to a role, but their current job title isn’t the best, or they have an unexplained gap on their resume, an ATS may rule them out before a human gets to take a look.

Perpetuate biases

Similarly, ATSes can perpetuate biases in hiring. Some claim that having a computer evaluate candidates is more effective in avoiding unconscious bias in hiring than having a human evaluator— and perhaps that is true. But ATSes were created and coded by humans, and unlike humans, they are incapable of becoming aware of their ingrained biases and working to combat them.

Say your ATS is programmed to prioritize candidates with a college degree. That may eliminate qualified candidates who are self-taught, who hold certifications or two-year degrees, or those with other diverse backgrounds. Likewise, if you’re only prioritizing certain types of work experience, perfectly qualified candidates may be passed over for those who only work better on paper. A human HR team that is intentionally working to hire diversely and offer opportunities to those from underrepresented backgrounds can do more good that a software that rules them out without a second look.

What’s the solution?

What’s the best way to balance all of these factors to find great candidates and still keep costs low? We recommend personalized, human recruiting. If you have an HR recruiter already on staff with your company, that’s great. If not, there are many options for outsourcing the process to recruiting partners like Tech Talent South. We find and place high-quality tech talent with corporate partners from small businesses to Fortune 500 companies. If you need great candidates, don’t let an ATS cause you to pass over the perfect person. Our team of recruiters provides full-service recruiting with a human touch to find the best candidate for your team.

Is the cost saved by using an ATS worth the drawbacks? What is your team doing to hire competitively in today’s market? Let us know what you think.

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