This article was first published in July 2021 and was updated with new information about applicant tracking systems in March 2024.
Recruiting and hiring are not easy tasks — they’re foundational and essential components of your talent management strategy. Whether you’re a small business or a large organization, finding, screening, interviewing, and onboarding top candidates is a multi-step process with lots of people involved. That’s why using an applicant tracking system (ATS) is so important for a successful recruitment process today.
Applicant tracking software is packed with features designed to simplify processes and save time for recruiting teams. And their effect is proven —according to recruiting statistics, 94% of talent acquisition professionals say their ATS has had a positive impact. It’s no surprise that the ATS market is valued at more than $3 billion and is expected to grow to more than $5 billion by 2031.
Implementing an ATS takes your recruiting processes to the next level and ensures your place as a competitive employer in your space. That’s why we’ve explored what applicant tracking systems are and the purpose of an ATS. In this post, we’ll dig deeper into why using an ATS for recruitment is important for companies of all sizes in any industry.
Recap: What Is an ATS?
An applicant tracking system (ATS) is an automated tracking system employers use to manage job applications and candidate information. ATS software began as a faster means of parsing resumes, but today, they’re so much more. Now, these cloud-based solutions boast features ranging from passive candidate sourcing to job board posting to offer letter management. The systems are used for candidate relationship management, interview scheduling and execution, and task automation.
Using an ATS is a sure way to streamline outdated recruiting and hiring processes and help recruiters and hiring teams work more efficiently. It makes life easier for recruiters, HR departments, and applicants — in other words, everyone involved in hiring and recruiting.
Why Is an ATS Important for HR and Recruiting?
In today’s labor market, using an ATS is more important than ever. There’s stiff competition for skilled top talent, candidate expectations have shifted, and old ways of recruiting and hiring aren’t cutting it. You need fast, fair, scalable hiring processes, which means you need an applicant tracking system to step up your recruiting and hiring game.
ATS software is developing rapidly, giving you access to an increasingly powerful toolkit for sourcing, hiring, and retaining new employees. It gives you everything you need to design an engaging candidate experience, streamline your processes, and get candidates hired faster.
The best ATS solutions offer everything you need to support an excellent candidate experience and effective recruiting processes, including HR automation and artificial intelligence (AI):
- A centralized platform that acts as the source of truth for recruiting and hiring teams, enabling easier collaboration and communication
- Customizable career sites where you can showcase your employer brand and company culture
- Applications job seekers can complete on mobile devices and via text message in their language of choice
- Schedule interviews effortlessly with automatic links in candidate emails
- AI tools including a writing assistant to help you write job descriptions, offer letters, and candidate emails faster than ever
- An AI chatbot on your career site to answer candidates’ questions in real time and increase application conversions
- AI-powered recruiting assistance to help teams prioritize recruiter follow-up and optimize hiring workflows
- Automated email and text drip campaigns to build strong candidate pipelines
- Reporting and analytics for insight into how well your processes are working
6 Reasons Why You Should Use an Applicant Tracking System
1. Applicant tracking systems save time and money.
As you know, time is money, and that’s especially true when it comes to the expensive process of hiring, recruiting, and onboarding employees. Hiring costs range from $4,000 per employee to as much as 33% of their salary, and it can take weeks. In fact, the average length of the hiring process recently increased to 44 days, which means companies are spending more than ever to bring on new employees.
ATS software can help reduce those costs and weeks-long processes —86% of companies say that using an ATS report helped them reduce their time-to-hire. 69% of HR professionals using hiring automation say it’s saved them a significant amount of time. Thanks to reduced miscommunication, fewer tedious data entry tasks, and AI assistance, your hiring team will regain valuable hours in their work week. They can focus their efforts instead on processes that require a human touch, like refining the candidate experience, searching for new candidate sources, and engaging passive talent pools.
A fast hiring process means fewer vacant roles and increased productivity, both for the HR teams saving time and for departments across the company. With fully-staffed, productive teams, you can expect business success.
2. An ATS enables a better candidate experience.
Did you know that poor candidate experiences are on the rise? Since 2020, the number of negative experiences shared online has doubled. That’s having a big impact on hiring — 75% of candidates say an excellent experience impacted their decision to accept a job.
You can improve your candidate experience to stand out and attract top talent with the right applicant tracking system. Its features enable your team to:
- Keep candidates updated on their hiring status —71% of candidates want weekly updates
- Help recruiters get in touch with candidates faster to maintain engagement and speed up the hiring process
- Make it easier for candidates to apply with mobile application tools and responsive career sites
- Simplify new hire onboarding with an ATS that seamlessly integrates with other HCM software solutions
3. An ATS builds a passive pool of candidates.
Don’t underestimate this important reason why you need an applicant tracking system: it provides you with an ever-growing pool of candidates who are already at least a little bit interested in working for your company. 70% of job seekers are passive candidates who are looking for a job casually or not at all, and they’re a valuable source during a talent shortage.
Use your ATS to engage with your pool of talent and turn them into potential candidates, referral opportunities, or new employees. If this is a big hill to climb, most applicant tracking systems should come with tools to help you automatically group and reach out to talent pools.
4. ATSs are becoming standard.
Need just one really significant reason why you need an applicant tracking system? 75% of recruiters are already using one. That means you’re doing your competition a favor if you haven’t implemented or improved your ATS in recent years. While you typically want to stand out from the crowd, without a modern ATS, you could be standing out in a negative way —both to candidates and hiring team members.
ATSs that are easy to use, enable faster hiring, and simplify applications are becoming standard. Without one, candidates will notice and potentially abandon their application before even completing it. Your current HR team members will also notice. With more than 85% of workers considering a new job this year, the absence of an ATS can push them into another company’s HR department and discourage applicants to your open roles.
5. Applicant tracking systems bring in more qualified candidates.
As we mentioned, the cost of replacing employees can range from several thousand to tens of thousands. If your turnover is high, especially among new hires, those costs add up fast. Long story short, you want to avoid bad hires to increase retention, and 78% of recruiters say that their applicant tracking system has improved their quality of hire.
An ATS speeds up application processing, sifting through resumes to identify candidates with the most relevant skills and experience and enabling your recruiters to focus on people who are best suited for the open position. They’ll waste less time searching for a needle in a haystack and instead, can more thoroughly evaluate a selection of skilled candidates.
6. The more an ATS is used, the more insight you’ll gain.
It makes sense that using software over a longer period of time increases its benefits. Implementing an applicant tracking system means you’ll gain continuous insight that only improves as time goes on and it’s used more and more. Learn how your interview and onboarding processes can improve by accurately assessing key performance indicators like time-to-hire and retention rates.
Thanks to your ATS, your candidate pool will grow, your ATS will learn which traits result in best-fit employees, and you’ll identify many ways to make recruiting and hiring processes easier and more efficient.
Your Guide to Finding the Right ATS
With so many strong reasons why you need an Applicant Tracking System, it’s worth serious consideration of which ATS solution could work best for your organization. Finding the perfect applicant tracking system won’t be effortless, but we have resources to help with that. ClearCompany’s ATS Buyer’s Guide to narrow down your options and make an informed decision about which solution your organization should invest in.
Download our Applicant Tracking System Buyer’s Guide today to help you make the right decision about which system is best for your company.
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