How are hiring leaders using AI for analyzing resumes and applications?

How hiring leaders are using AI for analyzing resumes and applications

Digital resume-screening tools have helped businesses accelerate their hiring, yet standard resume analysis remains a time-consuming step in the process. According to TestGorilla, HR teams spend around seven business days reviewing incoming documents and shortlisting applicants who meet requirements, which is approximately 20% of the average 36-day time to hire. Reducing this time would go a long way toward improving hiring efficiency.

Many employers have found a solution in artificial intelligence. CareerBuilder has partnered with Morning Consult, a global leader in decision intelligence, to survey 400 cross-industry decision-makers to examine AI's impact on business recruitment and hiring. Published in the white paper "AI in Hiring: 2024 Trends, Insights & Predictions," our findings include the top 10 AI applications in recruiting, among which "analyzing resumes & applications" stands as one of the technology's leading uses.

How did businesses analyze resumes in the past? 

The traditional resume analysis process was entirely manual. Hiring specialists would visually scan each applicant's documents to gauge their suitability for the job. Candidates who met the essential criteria — education, work experience, and skills — would pass the initial screening stage. Otherwise, they'd have their resumes placed in a slush pile, most likely for disposal.

Big companies with abundant resources might do multiple rounds of resume analysis to pinpoint the best candidates. Their HR specialists might scrutinize the resumes that passed screening to gauge and rank each candidate. The candidates most closely matching the job's requirements and demonstrating the highest expertise would get on the shortlist. 

Computer programs would come to abbreviate the process but to a limit. As we said, document review still takes around a week, and that's with modern applicant tracking systems. 

ATS, by the way, presents a different problem because it's largely limited to keyword boundaries set by the employer. It might reject a candidate only because their resume displays three out of four key skills or four out of the preferred five years of experience. It fails to read resumes with an eye for potential. So, while ATS-assisted screening is faster than manual, some degree of manual screening may be necessary to compensate for low reliability.

How does AI improve the resume analysis process?

AI screening tools use algorithms to take a smarter and faster approach to resume analysis, going beyond the tight perimeter of strict keyword matching. Specifically, they use machine learning and natural language processing to analyze text strings, the relationships between text elements, and the context within documents. In short, AI resume analysis is the closest you can get to skilled human reading without having a skilled human read the resume.

AI-powered screening is much faster than human analysis, however. In just minutes, your AI tool can scan thousands of resumes and rank the most qualified applicants. Some can even apply their powers of contextualization to predicting a candidate's likelihood of success should they fill the role. 

"[AI tools] use machine learning and natural language processing to analyze text strings, the relationships between text elements, and the context within documents. In short, AI resume analysis is the closest you can get to skilled human reading without having a skilled human read the resume."

Advantages of using AI for analyzing resumes and applications

Analyzing job applications with AI can offer your hiring team the following advantages: 

  • Speed: With AI, expect to cut your screening time to mere days. 
  • Accuracy: AI-powered resume analysis can contextualize a candidate's qualifications as though it were one of your most experienced HR specialists. That humanlike quality is essential for identifying potential, predicting success, and ultimately selecting the best candidate.
  • Fairness: One human quality that AI overcomes is hiring bias, the tendency of hiring authorities to impose their preconceived notions on their recruitment decisions. The AI system is largely objective, so qualified candidates get a fairer shake regardless of inherited characteristics.
  • Authentication: AI's broad abilities allow it to do double duty during the screening stage. It can also analyze applicants' public data, such as from their social media accounts, which authenticates or invalidates claims made on their application documents. Therefore, a candidate who may have otherwise passed screening through keyword stuffing can get weeded out if they fib on their resume. The result is a more accurate talent pool for you.
  • Potential cost savings: A more accurate talent pool correlates with a higher likelihood of a smart hire. A smart hire requires less training and represents higher odds of retention. And when someone knows their role and sticks around, the employer avoids pouring resources into upskilling, reskilling, or replacing.

Tips for analyzing resumes with AI tools

If you believe leveraging AI can help your organization better fulfill its hiring needs, we recommend taking heed of these tips to ensure you get the outcomes you envision:

Take time to find the right tool

A fair amount of preparation should precede AI implementation in any capacity. Otherwise, you may end up with a product that can't do what you need. To realize the advantages we discuss above, look for an AI tool that appropriately covers the following areas of functionality:

  • Rapid screening: Only a rapid-screening AI tool can manage large application volumes within narrow time frames. 
  • Data accuracy: For the most accurate data, you want an AI tool trained on multiple data types. Ideally, it uses numerous machine learning, predictive analytics, and corrective feedback models so that you get the most robust and trustworthy analyses.
  • Natural language processing: An AI tool with natural language processing capability can find you better matches by assessing a wider spectrum of data sources. The more that it learns about a candidate, the more accurately you can authenticate the details of their resume.
  • Ranking: The ability to rank your candidates takes a tough responsibility off your plate. Look for a tool that ranks candidates based on an expansive list of parameters, which should yield better, more accurate matches.
  • Diversity: An AI tool with diversity indicators can customize your talent search in such a way that balances your organization's inclusivity initiative with unbiased matching, leaving you with the power to choose from a well-cultivated and highly varied list of candidates.

Integrate AI with ATS

If you're currently using ATS to propel your hiring process, you probably want an AI tool that can integrate with your existing system, not supplant it entirely. That would promote a more seamless transition to an AI-powered approach, as it would be a matter of upskilling rather than reskilling.

Don't overlook the human element

AI resume analysis isn't meant to replace your HR team. It should empower your existing workforce to make better-informed decisions. So don't revise your recruitment and hiring strategy to rely entirely on algorithms. Rather, plan to train your team comprehensively on the ins and outs of your chosen AI tool so that they extract the most value from it.

Of the 400 hiring decision-makers surveyed for "AI in Hiring: 2024 Trends, Insights & Predictions," 52% report using AI for analyzing resumes and applications. We expect the number to grow steadily as increasing numbers of employers discover the broad utility AI can offer to their hiring process. Early adoption can help your organization position itself advantageously in the competitive landscape.

Of course, a competitive advantage is hardly possible unless you understand the technology at hand. Many hiring decision-makers today feel that AI is advancing beyond their ability to keep pace. Luckily, CareerBuilder can help you stay current. Being one of the first employment solutions to implement AI technology has allowed us to develop robust AI-powered tools built on over 25 years of data. You can leverage these tools at key stages of your talent search, including sourcing the most relevant candidates and optimizing your job descriptions

More tips about evaluating job candidates:

It may seem counterintuitive, but identifying candidates who don't meet your criteria can be a valuable first-line screening strategy. 

Many businesses now use AI tools to craft, deliver, and score pre-employment tests — assessments for validating competencies among candidates who pass the initial screening stage.

First impressions aren't always correct. As a hiring decision-maker, you should know when to give a candidate another look.

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