Part 1, AI and Applicant Tracking Systems

It is a known fact that AI has changed the world and the job market. The issue is that keeping up with the trends and all different AI tools and functionalities with different websites is time consuming and overwhelming. Escaping AI is not an option, so if you’re working full-time, part-time or a freelancer, using AI is a part of your daily routine.

Yes, AI is used in ATS Systems when you apply for jobs. Keep in mind that there are no global laws mandating that companies disclose AI usage in ATS systems. Areas like New York, Illinois, and the European Union are leading the way in requiring companies to inform candidates about the use of AI in hiring processes. Currently, Ontario, Canada does not have specific laws requiring employers to disclose the use of AI in hiring processes. What is important to keep your eyes on is federal proposed C-27, this bill would impact employers across Canada on how AI systems are used in the hiring process and the impact on employment decisions.

Federal Proposed C-27

Part 1 of this series will explain specifically how AI is used in Applicant Tracking Systems and why it is used. The next two parts will focus on a compilation of resources and the future of AI.

Why is AI used in Applicant Tracking Systems?

Efficiency: Reduces the manual workload for recruiters by automating tasks like resume screening, candidate ranking, and interview scheduling.

Accuracy: AI can more accurately match candidates to jobs, improving the quality of hires.

Fairness: Helps reduce bias by focusing on qualifications and removing demographic information.

Speed: Speeds up the hiring process, reducing time-to-fill (recruiting metric) and increasing candidate engagement.

These AI-enhanced features are transforming ATS systems into powerful tools that can predict, recommend, and help improve companies hiring decisions.

How is AI used in Applicant Tracking Systems?

1. Resume Parsing & Screening – How it works: AI-powered ATS systems can automatically parse resumes, extracting key information such as work experience, education, skills, and certifications. This data is then organized and compared to the job description. Benefits: Speeds up the initial screening process by filtering out unqualified candidates and highlighting the most relevant ones. AI uses natural language processing (NLP) to understand the context of the resume rather than just keyword matching.

2. Keyword Matching & Scoring – How it works: AI algorithms scan resumes for relevant keywords and phrases that match job descriptions, but they go beyond simple keyword matching by understanding synonyms and context. – Benefits: AI enhances keyword matching to rank candidates based on the relevance of their experience to the job. This helps avoid missing candidates who use different terminology but are still highly qualified. 

3. Bias Reduction – How it works: AI can be trained to remove identifiable information such as names, genders, and ages from resumes to minimize unconscious bias during the initial stages of recruitment. – Benefits: Helps create a fairer hiring process by focusing solely on qualifications, skills, and experience rather than personal characteristics that might lead to discrimination. 

4. Predictive Analytics – How it works: AI analyzes historical data to predict candidate success. It can identify patterns of successful hires based on previous candidates’ resumes, interviews, and performance in similar roles. Benefits: Predictive analytics help hiring managers make more informed decisions about which candidates are most likely to succeed in a role, based on data rather than intuition. 

5. Automated Candidate Ranking: – How it works: AI ranks candidates by scoring them based on how well their qualifications and experience match the job requirements. This can include factors such as skills, previous job titles, and years of experience. Benefits: Automated ranking reduces time spent manually sifting through resumes and helps recruiters prioritize their focus on the best candidates early in the process.

6. Chatbots for Pre-Screening: – How it works: AI-powered chatbots can engage with candidates during the application process, asking pre-screening questions to assess their eligibility for the role. The chatbot gathers basic information and assesses responses. Benefits: Streamlines the early stages of recruitment by quickly filtering out unqualified candidates and improving candidate engagement through instant interaction.

7. Interview Scheduling: – How it works: AI-powered ATS systems automate interview scheduling by coordinating between the candidate’s and recruiter’s calendars, reducing the back-and-forth typically involved in setting up meetings. Benefits: Saves time and increases efficiency, ensuring faster interview setup and reducing the risk of losing candidates due to delays.

8. Candidate Experience Enhancement: How it works: AI improves the candidate experience by personalizing communication throughout the recruitment process. Automated systems send updates on the status of an application, offer insights into next steps, and provide a smoother, more engaging application experience. Benefits: Helps candidates feel more connected to the process, reducing frustration and keeping them informed, which can positively impact a company’s employer brand. 

9. Skill and Personality Matching: How it works: AI systems can assess candidate profiles to determine not only if they have the right skills, but also whether their personality or cognitive abilities align with the company’s culture or role. This can be done through game-based assessments or psychometric analysis. Benefits: Ensures that candidates are a good fit for the role not only in terms of technical skills but also in terms of cultural compatibility and personal strengths. 

10. Candidate Shortlisting: How it works: After analyzing applications, AI helps in generating a shortlist of candidates based on their fit for the role. This can involve ranking candidates based on how closely their profiles match the job description or previous successful hires. Benefits: Shortlisting is done with higher accuracy and efficiency, helping recruiters focus their efforts on the best-suited candidates and reducing time-to-hire.

11. Continuous Learning & Improvement: How it works: AI systems learn from historical hiring data, continually improving their algorithms over time. They get better at identifying what makes a successful candidate, helping companies refine their recruitment processes. Benefits: With each recruitment cycle, AI-driven ATS systems become smarter, helping companies improve the quality of their hires over time.

12. Predicting Candidate Drop-Off: How it works: AI can analyze the recruitment process to predict when candidates are likely to drop off or lose interest in the application process. This is based on behavioral data such as time spent on the application, interaction with emails, and engagement with the career site. Benefits: Identifying at-risk candidates allows recruiters to intervene and re-engage them, reducing the chances of losing top talent.

13. Automating Diversity & Inclusion Efforts: How it works: AI can help track and report on diversity metrics by analyzing candidate pools for gender, ethnicity, and other characteristics (where appropriate) to ensure diversity goals are met. Benefits: Assists companies in building more inclusive workforces by flagging areas where diversity targets are falling short and helping reduce bias in the selection process.                                                                                                                                                                                                                                                                                 For all job seekers, keep in mind how and why AI is used from the recruiting lens when applying for jobs online and how it streamlines the recruitment process. Should you use AI to build your resume? Yes, use it but be human about how you market yourself. That’s where I come in as your coach, when you book a consult with me, we discuss all of us this in our sessions. Thank you for reading!