Denis Grankin Head of Sales Department

AI-powered ATS: Revolutionizing the Hiring Process

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AI-based applicant tracking system

It feels like AI is everywhere. There is even a danger of treating AI as a hammer for which any problem is a nail. However, there is one area where AI is truly indispensable: Improving recruitment with Artificial Intelligence. The days when recruiters hand-selected resumes are long gone.

Today, they have been replaced by AI-based Applicant Tracking Systems. On the surface, it may seem easy to improve candidate selection with AI. But is it really that simple? The truth is that the impact of AI on Applicant Tracking Systems and recruiting is way more significant.

Check out this article to learn how AI-powered ATS actually works, whether it's feasible to deliver an error-free AI-enhanced recruitment process, whether there are challenges in ensuring AI-powered candidate selection, and more.

Let's get started.

AI In Recruitment

As of 2023, the global AI recruitment market is valued at $590 billion and is projected to grow at a CAGR of 6.5% through 2028. Here's how the AI recruitment market has evolved over the years:

AI ATS market size

Often Artificial Intelligence is only associated with robotics and high-tech solutions, which is far from being the case. Meanwhile, Artificial Intelligence is first and foremost a technology that can be incorporated into any system if the task is to automate, speed up, and fine-tune complex operations. The recruiting field, like recruiting software development, is no exception. Semantic search for talent acquisition, automation of candidate screening, and NLP-based ATS algorithms are just a few of the ways in which AI can be of great help in the hiring process both now and for years to come.

Not surprisingly, nearly 90% of companies and 65% of recruiters worldwide are now adopting AI in recruiting. Over 86% of recruiters believe that smart applicant tracking systems powered by machine learning enhance the recruitment process.

They also note that among the benefits of leveraging AI in the recruitment process, such as via ATS, are the following:

  • saving time (44% of respondents),
  • gaining valuable insights (41%),
  • making the job easier (39%).

benefits of AI in recruiting

One of the pressing issues with hiring is that employers often get "ghosted" by job seekers. Now the rules have changed as AI in ATS has come to the rescue. It helps:

  • Make scheduled interviews a reality;
  • Increase candidate conversion and cut recruitment time from 10-14 days to 4 days;
  • Save about 5 hours per week per recruiter by automating their tasks with AI-based ATS.

When it comes to other AI-driven ATS benefits, such as cost savings, it has reached an incredible 40% in North America in 2022. There are even more benefits ahead.

Some AI-driven hiring process stats:

AI-driven hiring statistics

What Is An AI-powered Applicant Tracking System All About?

AI-driven ATSs have revolutionized recruiting. And they keep doing it. These systems harness Artificial Intelligence and Natural Language Processing (NLP) to simplify and improve the hiring process. As a result, AI-powered ATSs are helping companies reach the right candidates faster and with less effort.

But wait a minute... When they say AI Applicant Tracking System, what do they really mean?

Behind the AI-based recruiting platform idea is an array of advanced technologies, sophisticated algorithms, and rule-based logic to analyze, screen, and select the right resumes. Or rather, the right candidates.

Let's make it clear from the outset: an ATS with AI is not what you might think it is.

It's not a robotic assistant that anticipates your thoughts, nor is it a character from a sci-fi movie. When people talk about Artificial Intelligence ATS, they mean the use of some AI-related technologies to automate and speed up the process of recruiting and hiring candidates. Thus, we can say that these processes are getting more intelligent.

ML-powered ATS

With AI, all recruiting-related things are getting tech-savvy. That's it.

No guesswork, please.

So how does the AI-enabled ATS work? Should candidates be worried? An AI recruiting platform is not the same as a human recruiter. After all, a "machine" might not be up to the task and overlook worthy talent, right?

This is indeed true, but we should not forget the opposite:

  • Artificial Intelligence ATSs are getting better and better. Sounds lame, doesn't it? Then let's move on to the next point.
  • Employers are also interested in quality hires and are unlikely to want to lose money and time on mis-hires. Did you know that 30% of new hires quit within the first 90 days of employment? And one mis-hire costs a company an average of $15,000. Impressive, isn't it? Thus, AI-driven recruiting can be called an equal opportunity game.

Artificial Intelligence Technologies In ATS

AI-based ATS implementation requires engineers to apply various AI technologies that can boost the recruitment process. Is enhancing candidate selection using AI your goal? Here's how it can be brought to life.

Natural Language Processing (NLP)

Natural Language Processing for Recruitment is an AI technology aimed at understanding and processing human language. Leveraging NLP in Applicant Tracking Systems is a must.

NLP-driven candidate screening is done through NLP-based algorithms. They are utilized to parse resumes, extract relevant information from candidate documents (such as resumes and cover letters), and turn it into structured data that can be easily analyzed and processed by any smart system.

Machine Learning

Machine Learning is a field of Artificial Intelligence that deals with training AI algorithms to evaluate candidates based on data. Machine Learning in Applicant Tracking Systems analyzes historical hiring data to identify patterns that lead to the right candidate. As a result, the recruitment process gets more efficient as ML algorithms enable AI-based ATS to recommend the most suitable candidates based on their skills, qualifications and experience.

Semantic Search

Semantic search in ATS platforms is an advanced search technology that goes beyond simple keyword matching. Semantic keyword optimization in ATS means that the system can grasp the context and meaning of search queries, thereby matching them to candidates who may use different but relevant terms to describe their skills and experience.

Bias Reduction Algorithms

Bias reduction algorithms are AI technologies used in ATS to minimize bias in the candidate selection process. How is this done? Machine Learning algorithms are at the heart of this process. They are trained to look only at qualifications and experience and not at factors such as gender, ethnicity or age. This ensures a fair and unbiased candidate evaluation.


Automation in ATS involves using AI technologies such as NLP and machine learning to optimize and automate manual tasks. Want some examples? Here are some: parsing resumes, extracting relevant candidate information, and automating initial candidate outreach.

Predictive Analytics

Leveraging AI for smarter candidate sourcing also means getting the most out of predictive analytics. AI-enabled ATSs use predictive analytics to gain insights into recruiting strategy and candidate sourcing channels. Predictive analytics gives recruiters insight into which sourcing channels and candidate qualities have led to the right hire in the past. The data obtained helps optimize recruiting strategy and improve the hiring process going forward.

How An Artificial Intelligence ATS Is Revolutionizing The Hiring Process

AI in Applicant Tracking Systems helps HR professionals screen and select candidates more accurately. The technology itself, not a human, analyzes candidate data and leverages the findings to make informed decisions about who is best suited for the job. This saves time and effort and accelerates the company's business goals.

Let’s dwell on how AI in ATS benefits the recruitment process.

benefits of Artificial Intelligence ATS

Smart Candidate Screening Using NLP

The role of NLP in modern recruiting cannot be overestimated. See for yourself. Natural Language Processing in recruitment helps you better interpret resumes, cover letters, and other applicant-related docs. With NLP, AI-enabled ATS can more accurately find candidates that match the job requirements and make the hiring process smoother and smarter.

Improved Keyword Matching With AI

The AI-based ATS juggles keywords like a startup founder juggles elevator speeches. It searches for related words and phrases so it doesn't miss any potential candidates. As a result, recruiters get more comprehensive search results and can get exactly who they need.

Enhanced Candidate Experience With AI

Artificial Intelligence ATS benefits not only HR staff but also those who apply. The AI-powered recruiting platform provides candidates with personalized feedback and quick responses. This makes job seekers feel valued and respected. An enhanced candidate experience leads to a long-term and fruitful partnership between your business and a talented expert.

Speed, No Bias, Results

With the advent of AI-powered ATSs, many recruitment challenges seem to be vanishing. Let's face it, any evolution leads to this kind of scenario. It's like agriculture. In the early days, wheat was mowed and worked by hand, which required a lot of manpower and time and resulted in high yield losses.

With industrialization and the advent of increasingly sophisticated and of course smart machines, the path from wheat field to bun at McDonald's has shortened greatly. What used to take a whole season can now be done in a few days with little to no crop loss.

In some ways, it's like processing resumes and screening candidates.

So it's time to breathe a sigh of relief because:

  • The age, gender, and race of the candidate do not matter to the AI. What Artificial Intelligence does is look for the best people for you in terms of expertise. This is how inclusion and diversity become a reality.
  • Instead of you, the interviews will be conducted by AI built into ATS. No more repetitive and exhausting interviews. All you get is outcomes.
  • What about speed? AI-driven hiring processes deliver the best candidates before you even decide you need them. Seriously: the system anticipates your business' talent needs lightning-fast and finds them for you just as quickly.

Don't you think the future is already here?

Building An AI-powered ATS Means Hiring An Employee Who Never Gets Tired

Would you like your hiring process to be uninterrupted, recruiters to work without coffee breaks, weekends, and sick days, never tired, and always ready to communicate with even the most difficult candidates? While humans still have the above disadvantages, the AI implemented in ATS is free of them.

Besides, leveraging an AI-based ATS is cost-effective. You turn to IT outsourcing services once to hire software developers capable of creating an AI-based ATS, and then enjoy the benefits of this recruiting software development for years to come. Don't forget that your AI-driven ATS will never sleep or ask for a pay raise. It's something to think about, isn't it?

But are things so rosy when it comes to AI in recruiting? There are actually some concerns about the use of AI. Let's break down what they are and whether they can be addressed.

Spoiler: It definitely can.

AI In Applicant Tracking System: Concerns And Red Flags

Let's shed some light on the adoption of AI in recruiting and discuss some of the challenges involved.

Security Issues

How are security issues being addressed? you may ask. You are right, security issues are still a priority as new technologies are unpredictable. For example, there may be robot uprisings. Just kidding. In all seriousness, security is one of the top priorities for AI developers at all times. That's why experts are constantly improving measures to prevent information leaks, fraud, failures, and other security issues.

Ethical Issues

One might assume that if AI is not a human being, then it is completely free of such human-specific qualities as prejudices and biases against other people. But it isn't. AI algorithms are trained on data, and this data is given to them by humans. Thus, an AI-powered ATS that deals with recruitment needs is as unbiased as the data on which it is trained. It is a vicious circle.

AI is not magic, but the product of human intelligence, and therefore it is also subject to bias (for example, AI may favor men over women for a particular position or vice versa). Don't be misled by this.

Data Privacy

When dealing with Artificial Intelligence, there has to be a balance between, on the one hand, algorithms having access to all the data we give them and, on the other hand, data privacy. Finding this balance is not easy as algorithms are not humans, you can't talk to them and you can't convince them.

Empathy Matters

It would be a mistake to entrust the process of recruiting future employees to Artificial Intelligence alone. Empathy, intuition, support, enthusiasm, and culture are things that an AI-driven ATS can't identify and provide, but human recruiters can. Therefore, the hiring process must entail a mix of technology and human communication. So, fellow recruiters, don't worry ahead of time, you are needed and will be needed for a long time to come.

How To Develop An AI-Powered ATS For Your Business Needs

As a skilled software development team, DDI Development can offer a wide range of robust IT outsourcing services to meet the diverse business needs of our clients. One of our core competencies is recruiting software development, where we create reliable and user-friendly software solutions tailored to meet various recruiting challenges.

Our team of engineers, designers, and business analysts is focused on developing Artificial Intelligence-based ATS platforms to make the most out of it in recruiting. With advanced technologies such as GPT-3 and GPT-4, we create intelligent software that automates candidate screening and personalizes the job posting process, thereby optimizing the entire hiring process. We adhere to Agile Project Management practices to ensure efficient and smooth project execution and delivery of agreed deliverables.

Whether you need a web-based or mobile AI-based ATS, our experience in IT outsourcing and staff augmentation services will enable us to match your project with the right developers.

By partnering with us, you get access to a talent pool of skilled technicians who can estimate software development time as accurately as possible and perform their work just as accurately. All that is left is to onboard the development team.

Bottom Line

AI-powered ATSs are revolutionizing the recruitment process. Automated candidate screening and personalized job matching with AI-based ATS can not only save time and money but also significantly enhance the efficiency and accuracy of recruitment now and beyond.

For companies looking to thrive in today's competitive marketplace, utilizing Artificial Intelligence-driven recruitment solutions is no longer an option, but a must. Attracting and retaining top talent is paramount in the head-to-head race with your competitors, and ATS with Artificial Intelligence can empower you to achieve this goal.

By properly integrating AI into your ATS or your recruitment processes in general, you can make the most of AI and realign your talent-sourcing strategies for sustainable business growth.

Drop us a line to find out where to start.

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