Have Applicant Tracking Systems (ATS) Ruined Recruiting, Hiring, and Job Search? A Quintessential Careers Annual Report 2013

Quintessential Careers Reports on the State of Internet Job-Hunting

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by Katharine Hansen, Ph.D.

Quintessential Careers Annual Report

In 2001, as a service to our readers, the staff of Quintessential Careers began to conduct an annual review of the state of job-hunting on the Web. Because so much is written about the use of the Internet in job-searching (job boards, social media, resume posting, networking), and because job-hunting and networking online has become the norm for finding a new job, we developed these job-hunting annual reports for job-seekers. As we update our content, we intend to let these annual reports stand as historical snapshots of Internet job search at the time of publication; thus, updating is limited to removing non-functioning links and outdated advice.

Let’s say there exists a standard tool for job-hunting, nearly universally accepted (if not universally loved) by both job-seekers and hiring decision-makers. Let’s say it turns out that three-quarters of the tools submitted in response to job vacancies are wholly unsuited to the current technology that assesses job-seekers’s fitness to fill those vacancies. Let’s say that job-seekers are poorly educated in how to adjust these tools to fit the technology and therefore present themselves as qualified for these job openings. And let’s say that job-seeker understanding of how to adjust these tools has increased incrementally at best in the years since employers began using the screening technology they currently use. Would that situation likely result in a desperate claim by employers that a “skills shortage” exists? Would it even exacerbate the current jobs crisis since many perfectly qualified people can’t demonstrate their qualifications and get hired because their tools are broken?

A press release the Human Alliance Ltd. issued at the time of this report’s writing noted, “Right now, we have about 3.7 million jobs open with a hire rate [of] 3.2 percent … We’re simply not filling those jobs fast enough, and the US economy is suffering from it,” Joe Shaheen, founder and managing principal of the Human Alliance Ltd., said. The number of openings is more than would be expected based on the current unemployment rate, writes James Surowieki in The New Yorker.

The tool, of course, is the job-search resume. The employer technology is the Applicant Tracking System (ATS), first used more than two decades ago to manage what one recruiter calls “a tsunami” of resumes submitted online. If we are to believe one of 2012’s most startling statistics from the company Preptel, this situation is not hypothetical. “Seventy-five percent of applicants are discarded [by Applicant Tracking Systems] because of the words in their resume,” the company states on its blog. Preptel has a stake in promulgating this figure because it offers a service that optimizes resumes for employers’ screening technology. But other facts and speculations that emerged in 2012 suggest a flawed process for both hiring decision-makers and job-seekers:

  • An ATS ranks the suitability (also known as relevance) of candidates. “Recruiters never read more than the top 20 resumes,” reports author Martin Yate. One recruiter affirms that few resumes get read: “Too many times recruiters don’t even look at the resumes,” says Eric Bleiweis, CPC, director of recruitment and employee engagement at Liberty Lutheran. “Instead they enter key words, and if a person’s resume does not score a certain value, then you get a thanks-but-no-thanks letter. [Editor’s note: Input from job-seekers suggests they are lucky to get a thanks-but-no-thanks letter; most get no response at all.] “This type of utilization of an ATS ‘ruins’ the hiring process and sometimes prevents companies from looking at the best prospective employees,” Bleiweis asserts.
  • “Only about 5 out of every 1,000 online applications ever make it to the hiring manager’s desk,” career coach Peggy McKee writes.
  • Applicant Tracking Systems not only fail to give high rankings to resumes of qualified candidates; they “still give the employer unqualified resumes,” notes Cheryl Roshak of CatapultMe Coaching.
  • “One large firm put the disguised resumes of their top five engineers through their own ATS screening process, and two of the five were screened out,” notes recruiting expert Dr. John Sullivan.
  • A research firm specializing in talent management, Meredith Levinson reported in 2012, conducted a test in which it “created a perfect resume for an ideal candidate for a clinical scientist position” and submitted the resume to an Applicant Tracking System from one of the best known and most used vendors of the systems. This “perfect” resume rendered so poorly in the system that it “scored a 43 percent relevance ranking to the job because the applicant tracking system misread it.” Here the problem was not so much the wording issue Preptel cites but formatting — data organized in a way that the software can’t read and lacking the preferred headings.
  • Wharton School management professor Peter Capelli, whose book, Why Good People Can’t Get Jobs: The Skills Gap and What Companies Can Do About It (read an excerpt) inspired the theme of this year’s annual report, offers an anecdote, much repeated in 2012, about a “company that had 25,000 applicants for a standard engineering position of whom the staffing people said not one was qualified.” Capelli himself experimented with applying anonymously for a job at his own company and failed to pass the screening process.

How have we come to this? I recall taking my college students on a guided tour through the nascent world of online job search back in 1996 — the same year we founded Quintessential Careers — and watching their wonder and glee as they saw how easy it was to find and apply for job openings via the Internet. And therein lies a significant root of the problem. The Internet, as we’ve noted every year of this report, just makes submitting resumes and job applications so easy, at least compared to the old days of typing individual resumes and cover letters, placing them in an envelope, and actually putting them in the mail. Today’s Millennial job-seekers neither know nor can image any other way than applying for jobs online. So we submit resumes online. And submit them and submit them in astronomical and unmanageable numbers. Worse, in our desperation for jobs, we recklessly submit resumes for jobs we’re not qualified for. We’ve thrown spaghetti at the wall, hoping it will stick.

So hiring decision-makers began to deploy Applicant Tracking Systems to cope with the firehose of job-seeker data coming their way. But beyond advice about packing resumes with relevant keywords and using simple resume formats, job-seekers never really got thoroughly schooled in how to prepare a resume for Applicant Tracking Systems. If they had, we wouldn’t be hearing that 75 of resumes are thrown out because they contain the wrong words. Presumably that figure doesn’t even address formatting issues that prevent resumes from being read properly. Skyler Moss works for a company that works with its IT consultants “to optimize their resumes so that they parse correctly in ATS systems.” Should job-seekers really need outside help just to ensure that Applicant Tracking Systems can read their resumes?

If Applicant Tracking Systems represented a truly effective tool for screening candidates, we probably wouldn’t be hearing about 3.2 million open jobs that employers aren’t filling fast enough. We wouldn’t be hearing about a skills gap, which in reality, as Surowiecki writes, is “very limited in scope,” based on recent studies. To be fair, Capelli doesn’t place all the blame for this situation on Applicant Tracking Systems; he also suggests that the unemployment rate has made employers too picky and more inclined to seek the “perfect” candidate. They are unwilling to train the candidates with potential to become their perfect hires.

Whether entirely to blame or not, Applicant Tracking Systems simply do not work as well as they could. In an article that begins with six snarky, facetious paragraphs describing how Applicant Tracking Systems should work, Janine Truitt writes, “The truth is recruiters spend more time troubleshooting and working around the things that don’t work in the ATS than they do enjoying the inherent benefits of the system.” Truitt adds that both job-seekers and hiring decision-makers “are far too involved in managing the system and its outputs to experience it in all its glory.” Julie Bos of Jobvite points to aging technology, suggesting that “many traditional ATS systems from 10-15 years ago simply weren’t built for today’s world of ‘Big Data.'” We’ll probably look back in a few years and marvel that we relied on such an inefficient system. I crowdsourced opinions on ATS from recruiters and other hiring decision-makers. The next section reveals what they told me.

A Necessary Evil: Applicant Tracking Systems From the Hiring Decision-Maker Perspective

The problem is the sheer volume of resumes.

Many hiring decision-makers will tell you that the huge flood of resumes they receive online makes Applicant Tracking Systems mandatory. “Gone are the days of classical hiring where the resume workload was manageable,” says business developer Thamir Ghaslan. “I know some recruiters, who, on average, receive 1,000 resumes per day, thanks to the Internet.” To cope with the overwhelming resume volume, hiring decision-makers are willing to sacrifice qualified candidates who get filtered out.

Meg McSherry Breslin on Workforce.com points out that hiring decision-makers are more overwhelmed than ever, having seen their ranks cut during the recession.

The problem is the number of resumes representing applicants completely unqualified for the jobs they’re applying for.

Too many job-seekers fail to discriminate between applying for jobs they qualify for and blasting their resume to every possible employer. They hope that somehow, some way, an employer will see their potential. The trouble with that approach is that Applicant Tracking Systems can’t read potential; they screen out the unqualified, and humans never see the resumes. “After working with several ATS systems over the years, I still find that upwards of 40 percent of the resumes are a poor match,” laments Doug Mendoza, an executive and business strategist.

For executive career consultant Richard Kirby of Atlanta, the percentage of mismatched resumes is even higher. “The real culprits are the job-seekers, who flood employers with resumes whether they are qualified or not,” he says. “With typical unqualified responses running at 90 percent and more, employers are just trying to defend themselves and make the process more efficient as they cannot drink from a fire hose full of irrelevant resumes.”

Like many career experts, we’ve advised — annually in this report and elsewhere on Quint Careers — job-seekers not to indiscriminately submit resumes for openings for which they don’t qualify. The “resume tsunami” shows no signs of abating, though. What’s the answer? One source interviewed for this article cited the application fee that students must pay to apply to colleges and wondered if a nominal fee, such as 25 cents per application, would stem the tide of indiscriminate resumes.

The problem is faulty or overly “picky” input from hiring decision-makers about what they require in candidates.

Several experts refer to the “garbage in, garbage out” problem with Applicant Tracking Systems. Andy Barrera, a senior technical recruiter at vtrIT, cites “a significant disconnection between the requirements that are gathered versus the requirements that are needed.” Echoes Breslin, “The programs often weed out highly qualified applicants because the job qualifications are laughably unrealistic or simply not needed for the positions.”

“Filters put in applicant systems are often too restrictive,” observes a source who asked to remain anonymous. He notes, for example that an MBA degree might be required, but people with other kinds of master’s degrees who could do the job will get filtered out. “Perhaps better job descriptions that are then matched with resumes with coarse, not fine, filters would lead to including more qualified people while filtering out the clearly unqualified,” the source suggests.

“For every story about an employer who can’t find qualified applicants, there’s a counterbalancing tale about an employer with ridiculous hiring requirements,” says Capelli, as quoted in this article by David Wessel, who also cites a job-seeker “who had been told he was perfect for a given position — except for the fact that his previous job title didn’t match that of the vacancy, a title unique to the prospective employer.”

Beyond restrictive job requirements, employers often make the application process itself prohibitive. “If an application process is too lengthy, asks for seemingly irrelevant data, doesn’t provide individual feedback to candidates, or is screening out seemingly good candidates, then these are all valid issues to raise,” notes Alex McCall, regional sales manager at SilkRoad technology, which sells Applicant Tracking Systems. “However,” McCall asserts, “a good ATS allows administrators to address all of the aforementioned points; therefore, in these cases I would suggest the real issue would lie with those responsible for system administration and users rather than the tool itself.”

Other experts suggest the systems are focused on the wrong criteria — skillsets. Recruiting expert and author Lou Adler asserts, “Maybe we should define the work instead of the skills needed to do it.” Instead, Adler says, “hire people based on their ability to learn, motivate, and lead others, and achieve results.”

The screening process still needs the human touch.

A purely cold, technological approach results in missing out on good candidates, some hiring decision-makers say. “You need a human touch at all levels,” says Bleiweis. “An ATS should make the process smoother” and not “prevent companies from looking at the best prospective employees.” Surowiecki concurs: “Fail to meet one the [pre-set criteria], and your application gets tossed, even if a good HR director might have spotted your potential.”

“Sadly, I have seen many well-qualified candidates discarded because the ATS failed to capture nuanced information,” Mendoza says. “It still takes a human to read between the lines and to knit together the mosaic that represents a candidate’s true value.”

Some decision-makers no longer use Applicant Tracking Systems or use them for only part of the process. “I don’t use an ATS,” declares executive recruiting consultant Natalia Bilash. “All of my recruiting efforts are through networking and referrals. In past jobs, I have used ATS and found them unsatisfactory. You spend time inputting information into the ATS program only to have the program limit the information you’ve input. I find them a waste of time.” Similarly Bleiweis receives hundreds of emails weekly, but, he says, “I look at each resume because an ATS is not the end-all that HR generally thinks it is. Remember we have been trained and mentored to find the right candidates, and that requires the human touch.” Mendoza notes that he, too, has stopped using any tool to sort resumes. “I find that I am able to scan a resume to find the candidate I am looking for with fewer steps and aggravation,” he says. “Not to mention that if I don’t see a fit, I certainly don’t want to store that resume in my database.”

“We always use humans to sift [through resumes], reports Paula Sanders, project manager at Hunt4Staff.com. “We’re convinced that no software can yet match the abilities of a well-trained human.” Similarly, Roshak asserts, “Nothing can replace qualifying the candidate. You can have all the keywords in place and look great on paper, but [a resume] can never take into account your work ethic, your personality, your energy level, your demeanor, your leadership potential, your sense of ethics or fairness, or anything other quality that is more important to the hiring process than skillsets.”

A source who asked to remain anonymous rejects the idea that the sheer volume of resumes makes manual screening unmanageable: “Regardless of how high a stack of resumes is,” he says, “it does not take all that long to sort it into “rejects,” “maybes,” and “short list.”

Barrera succinctly sums up what’s at stake: “We are making decisions on people,” he says, “and not just the words that are on a Word document.”

Now, let’s look at Applicant Tracking Systems from the candidate side:

A Black Hole: Applicant Tracking Systems From the Job-Seeker Perspective

Many job-seekers who submit resumes that end up in Applicant Tracking Systems are never contacted for interviews and never learn anything about the status of their application.

We hear from a number of job-seekers who express sentiments similar to this one: “I’ve applied to hundreds of jobs via an ATS and have never been contacted for an interview despite meeting all the qualifications listed.”

Perhaps these frustrated job-seekers do meet all the qualifications — or perhaps their resumes are among the 75 percent that don’t cut it in Applicant Tracking Systems.

Intake forms that gather the data that ends up in the Applicant Tracking System can be frustrating.

While applying to jobs online is easy in many respects compared to the old ways, it’s still a time-consuming process fraught with obstacles. “An applicant can easily spend hours applying through various ATS processes as a full-time hobby,” observes independent statistician, Web developer, and career advisor Joseph Ohler, Jr.

One job-seeker says he avoids online applications that request “data that is only being used to screen out.” (Labor-force writer Joshua Bjerke affirms the trickiness of data that screens candidates out: “In many cases,” Bjerke writes, a single ‘no’ answer to a question that may not even have particular relevance to a job can be the difference between your resume reaching a pair of human eyes and being automatically disqualified as a viable candidate by a software program that has no idea how to distinguish between a valuable candidate and one who simply knows how to cheat the system.”) The job-seeker also singles out the Taleo system (part of a trio of the largest ATS vendors that also includes Kenexa and Brassring) as making applying “a pain;” he will not apply to any company using the Taleo system, he says.

Randi Renee Shuck, who implements many Applicant Tracking Systems in her capacity as project manager, client services, at ExactHire, suggests that hiring decision-makers have sound reasons to make applications complex. “Some ask redundant information that can be found on a resume to see how well the applicant follows directions. Others are wordy on their screening questions to see how well an applicant can maneuver through excess noise.” Whatever the rationale, these complexities are no less irritating to applicants. “If job-seekers are so overwhelmed by the obstacles of the system that they fail to apply at all, we all lose,” Truitt writes.

Even when using the same Applicant Tracking System platform for multiple jobs, the job-seeker must repeatedly re-enter information.

The application process would certainly be less frustrating if job-seekers could limit the number of times they are required to input the same information. “Although common sense would dictate the sharing of the same applicant’s data among subdomains of an ATS provider, e.g., what’s valid for abc.taleo.net is also populated into xyz.taleo.net, that is not the case,” notes Ohler. “All data input to the ‘Big Three’ ATS of Kenexa, Brassring, and Taleo need to be re-entered for each subdomain therein.”

I concur with the repetition frustration based on my own recent experience applying for teaching positions. SilkRoad, for example, is the vendor behind an Applicant Tracking System frequently used in higher education. I repetitively completed many SilkRoad applications. Isn’t there a way I could complete a boilerplate SilkRoad application, reference it for openings at various universities, and then complete a short set of questions customized for each university and position? Colleges, for example, use a Common Application for students who want to apply to multiple schools; why could the same not be done in job search?

I also understand the complaint about questions designed to screen candidates out. One university I applied to is “supported, and guided by The Church of Jesus Christ of Latter-day Saints” (Mormons). A question on the application asks if the applicant is a member of The Church of Jesus Christ of Latter-day Saints. The existence of both a “yes” and “no” option suggests that those who choose “no” will still be considered. The rejection letter I received stated: “While anyone is welcome to apply, please be aware that [name of university] has a hiring preference for members in good standing with The Church of Jesus Christ of Latter-day Saints. Our intent is to fill positions here with this preference in mind.” An article by Dylan Alford describes getting a near-instantaneous rejection after clicking “no” to a similar binary choice — and tells what he did to get around the rejection.

Finally, I can relate to Ohler’s observation that “an applicant can easily spend hours applying through various ATS processes,” having spent many hours submitting just a few applications.

Job-seekers rarely get any feedback on what they’ve done wrong in terms of preparing their resumes for the Applicant Tracking System.

In most cases, candidates who apply through Applicant Tracking Systems never know whether their qualifications truly are deficient, or if simple tweaks to their resume would prove them to be worthy of consideration.

Says Ohler, “As a job seeker, the ATS would be more useful if it were to provide point-by-point feedback to the screened-out candidate as to which [data points] need how much improvement in which ways to qualify.”

Recruitment Manager Nalakumar Rs speculates that if candidates received feedback on the reason for a mismatch between requirements and application, job-seekers would stop applying for those types of roles in the future, and recruiters would eventually see a greater number of quality, relevant resumes.

Some evidence suggests that the feedback-deficit situation may be changing. Ghaslan says one of the more popular job boards in his area that “recently added the function of providing feedback by calculating my CV to the job description and skillset.” Now that he’s begun receiving that feedback, he notes that his CV is consistently “in the top 10 percent pile calculated against the hundreds of other candidates” — and he’s getting interviews. Another source says telling applicants quickly that they are under- or over-qualified is easy, but not all hiring decision-makers elect to offer this functionality in their systems.

Cover letters are almost universally ignored by Applicant Tracking Systems.

Cover letters used to be an effective way for job-seekers to distinguish themselves — to show off communication skills, reveal their personalities, and tailor themselves to the specific job opening in ways resumes can’t. A few years ago, while researching an article on cover letters for recruiters, I learned that these letters were rarely entered into Applicant Tracking Systems. Based on the insightful historical perspective of Denis Wilson’s article, Are we killing off the cover letter?, I would speculate that fewer still, if any, cover letters are entered in the systems today. “In most cases, the ATS and other internal HR systems [aren’t] set up to keyword-search cover letters,” Wilson reports. “So recruiters would never see the cover letters as they typed in a few keywords when looking for solid candidates.”

My research indicates cover letters aren’t quite as dead as Wilson’s article makes them out to be. Our white paper, Cover Letter Reboot: A Crowdsourced Update of Traditional Cover-letter Advice for Today’s Job Search, features a number of hiring decision-makers who swear by cover letters and still want to see them. Hunt4Staff’s Sanders concurs: “We still place a great deal of weight on the cover letter as the outstanding candidate’s chance to put some gloss on a well-constructed CV,” she says. Still, among increasing numbers of hiring decision-makers, job-seekers have lost the opportunity to give their application a boost with a well-crafted cover letter.

Final Thoughts on ATS: Solutions on the Horizon?

Some evidence exists that Applicant Tracking Systems are slowly improving. Lauren Weber writes of the quest for “the holy grail: software that can read resumes intelligently, flagging a handful of truly promising candidates to recruiters and alerting job-seekers to openings that are laser-targeted to their skills and background.” Weber cites efforts by the big job boards — Monster and CareerBuilder — to develop “search algorithms designed to sort resumes in a more nuanced way than the original keyword-based model,” as well as a drive toward semantic search, “teaching computers to think like people,” “software that can predict a good fit between candidate and employer,” job-matching that integrates LinkedIn or Facebook, and “ways to marry technology with the personal touch that drove hiring before the Internet age.” One source for this article mentioned one such technology, HRMC Acclaim, which he describes as “a much better system of managing the hiring process that works to the benefit of both employers.”

Other experts point to the need for the human and personal touches we discussed in our 2011 Job-Hunting Annual Report and 2012 Job-Hunting Annual Report. “The relationships that organizations are able to develop, utilizing new technologies like social media and other tools, with employees and candidates and prospects will differentiate the best recruiting from the mean,” writes Jason Warner, whose article also provides a concise history of Internet job search and recruiting. “The tool and approaches will be different, but the authenticity and real human connections will remain.”

Meanwhile, we offer articles to help readers get quickly up to speed on how to prepare resumes not to be screened out by Applicant Tracking Systems, as well as ways to avoid them altogether:

About this report series … Our annual reports are compiled from an analysis of reports, articles, blog posts relating to online job search and recruiting over the past year.

Gain additional insights into how you can improve your resume and succeed with ATS using these free Applicant Tracking System Tools for Job-Seekers.

Questions about some of the terminology used in this article? Get more information (definitions and links) on key college, career, and job-search terms by going to our Job-Seeker’s Glossary of Job-Hunting Terms.

Katharine Hansen, PhD, QuintCareers.com Creative Director Katharine Hansen, Ph.D., creative director and associate publisher of Quintessential Careers, is an educator, author, and blogger who provides content for Quintessential Careers, edits QuintZine, an electronic newsletter for jobseekers, and blogs about storytelling in the job search at A Storied Career. Katharine, who earned her PhD in organizational behavior from Union Institute & University, Cincinnati, OH, is author of Dynamic Cover Letters for New Graduates and A Foot in the Door: Networking Your Way into the Hidden Job Market (both published by Ten Speed Press), as well as Top Notch Executive Resumes (Career Press); and with Randall S. Hansen, Ph.D., Dynamic Cover Letters, Write Your Way to a Higher GPA (Ten Speed), and The Complete Idiot’s Guide to Study Skills (Alpha). Visit her personal Website or reach her by e-mail at kathy(at)quintcareers.com. Check out Dr. Hansen on GooglePlus.

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