As we have already seen the penetration of AI in recruitment is relatively slow.
While most recruiters remain skeptical about its impact, many forward-thinking recruiters are finding that AI can be a valuable ally rather than a replacement. For those early adopters that are paving the way, understanding how AI fits into the recruitment process is crucial. This chapter takes a closer look at AI’s active role in recruiting, where it is currently used,, and how it might be making a difference where it matters most.
“AI won’t replace people, but those who harness its potential will replace those who don’t.” Karim Lakhani, Harvard Business School
Back in the day, during the Industrial Revolution, engineers were all about building machines to take over those boring, repetitive tasks that workers had to do all day long. This meant that businesses could get more stuff done, but it also meant that workers had to learn new skills to do jobs that were more creative and needed a human touch. You know, the kind of work that can’t be done by a machine.
In the current AI-powered technological explosion, the business model stays pretty much the same. Some cognitive tasks, while crucial, are repetitive, manual, and just plain boring. Using AI to automate these tasks will give workers more time to focus on higher-level tasks that require a human touch. This increased efficiency could potentially lead to greater job satisfaction, which might drive the adoption of these next-generation AI applications.
Jonathan Kestenbaum, Managing Director, AMS Technology Strategy & Partners agrees with this: “We believe efficiencies created by AI will provide bandwidth to solve business problems such as measuring hiring manager satisfaction, focusing on quality of hires, and building better teams. It is not just a question of what AI is going to do for us today, but what AI can do tomorrow, and how teams will need to be restructured to align with this new technology,” But how much of the overall work of a recruiter can be automated? A number that comes up on most of the studies and surveys is 40%.
A McKinsey & Company 2022 study states that 40% of recruiting tasks could be automated, while current estimations suggest as much as $5,000 to $10,000 per hire could be saved using Generative AI (Gen AI). This transformation will allow TA and HR professionals to focus on strategic business issues, enhancing the quality of hires and building better teams.
However, AI is difficult for companies to navigate, and many companies are still establishing their AI policies. This number sounds logical, but what exactly are the tasks cumulating to this 40% number?
LinkedIn Study The Future of Recruiting is not very illuminating apart from stating that GenAI can help in writing job descriptions. At least we got one from this. Writing job descriptions is very important because it defines the top of the funnel for talent acquisition (check out a free online GenAI tool I created that can help you create optimized Job Descriptions) but it is not the most important part of a recruiter’s work. I would say it is more like 2-3% of the time but most of it is consumed talking with the client to understand requirements and posting the job description to job boards if needed etc.
Apart from job description optimization what are recruiters using AI for? A survey from Workable seems to be more illuminating. They created a list of the most popular AI automations for recruiting Let’s take those one by one and comment on them.
Resume Screening → Maybe 10% of my time as a recruiter?
It seems that most of the recruiters use AI to get help on resume screening. Indeed resume screening for an experienced recruiter is a mundane task. It usually takes 1-2 minutes or less per resume and the average job gets around 250 CVs so the AI here saves around say 500 minutes or around 8 hours of work per job.
AI based CV screening, is the biggest drama between recruiters and candidates. People say there’s bias because of AI and all these regulations around it. We’ll talk more about that later, though. Automated CV screening certainly makes sense for high-volume recruiting e.g. for companies that receive thousands of CVs per job. In this case time saving is higher.
In my experience while testing these AI CV screener systems, the most important part is the transparency of the assessment process by the AI. For example I would love to see a report for each candidate that states exactly what the logic is behind the candidate assessment and not just a score or some checkmarks. This would be very useful to me as a recruiter because I can pass this report to my client and also be protected around DEI and regulations that are coming up more and more often.
Candidate matching → Maybe 2% of my time as a recruiter?
Candidate matching with jobs from my internal database might be very useful for me as a recruiter because I would like to be able to upload a job description and have the proposed candidates surfacing so I can reach out to them. This is already happening with simple search terms and the AI does not need to be very complicated. What I would love to see would be advanced matching with logic beyond keywords plus the logic behind this matching. In my experience, this advanced matching AI is not still available. But the current search in my candidates’ CRM is effective enough for my operations. The use of AI here probably does not save me too much time here. I am happy with my current operations as they are. Maybe with more intelligence, it can make this search more effective and transparent. But not a big move on my efficiency needle as a recruiter.
Interview scheduling → Isn’t this automated already? Why AI? Another 2% time saving
This is indeed a time-consuming task maybe 2% of my time? It is arduous to connect the dots between candidates and hiring managers and there is lots of back and forth of emails, calls etc. There are chatbots here that can help but especially when there is a star candidate I would like to be directly involved in this rather than have a chatbot to reach out to this person to arrange the interview. Plus the fact that automated schedulers like calendly etc already help a lot on this task without too much effort on my side.
Candidate Tests and Assessments → No AI at all needed?
These are automated tests that companies have candidates go through so they can understand their personality and what would be a good match for them going forward. Those tests do not need any AI at all and do not save me time. Candidates also are not fancy of those tests either and might lead to bigger drop out unless you are a company with a big brand that everybody wants to work for.
Video Interview → This is a big time saver, around 10% of my time?
As a recruiter I always want to get a feel of a person before I pass them to the hiring manager. But how exactly does AI helps with this task? There are AIs that look into emotions and attitude of the person doing the interview but this is very messy as it gets into privacy laws and surely can be biased and misleading. What I prefer as a recruiter for candidates is the one way video interviews. If I can have an AI that can schedule, invite and help the candidate go through a quick one-way video interview (no AI avatars and stuff, just a banner with a question) and then have then AI do a transcript of the interview and report on the performance of the candidate with transparency on the logic of the assessment that would be a huge time saver. Plus it would help me to do many more video screenings instead of just being picky about who should I invite for a video interview. I might surface a hidden gem with this video interview or uncover false info on a superstar’s CV before I pass these candidates to the hiring manager. I certainly believe that this AI application is both a time saver and a leverage. I haven’t seen any AI that assesses the one-way video interviews for me yet anywhere.
Another solution that I would love in this space would be an AI wingman that keeps notes and also assesses the candidate’s responses especially the technical ones during my video interview screening. This way the AI can help me focus on my human touch with the candidate while I do not have to take notes. Moreover as I am not knowledgeable of all technologies the AI can assess the technical prowess of the responses of the candidate during the video interview and give me a report that I can them pass to the technical manager.
Rest of items
For the rest of the items mentioned in the Workable study e.g. predictive analytics, background checks, chatbots to help with questions about jobs and workforce analytics, these are not time savers but more like enablers for data driven recruitment and workforce optimization.
But there is one item that looks like it is a big chunk of my time as a recruiter and it is not given the merit it deserves in the studies of AI in recruitment. This item is related to my talent acquisition practices.
Talent acquisition → Maybe 20% of my time?
Any recruiter worth his/her salt knows very well that job boards can go as far as 20% of the talent pool actively searching for a job. The real gems are those passive candidates who make up the rest of 80% of the current workforce and are not actively looking for a job.
So we all do (or should be doing) active scouting for job positions to increase our quality of hires. This is a very time-consuming task. From actively seeking the right profiles to finding the emails to drafting personalized emails (this is the most effective and timeconsuming part of this process), talent scouting is indeed very time-intensive.
This is a place where I believe GenAI can shine and save time with direct ROI. I would love to see an AI that asks me to upload a job description, automatically takes the requirements from the job description, and then seeks the right profiles of candidates to create a scouting list of around 1000 candidates. It then automatically creates a personalized sequence of emails for each one of these candidates as we all know that a personalized approach increases the response rates. It sends around 5 emails to each candidate and arranges calls with me for those who express interest. It also takes the CVs from those who decide to apply and adds them to my candidate pipeline. It creates a daily report on the progress of scouting.
This would save me a tremendous amount of time. I just want to focus on other stuff while the AI does the scouting for me, I want to talk with those that are interested and entice them to apply. Now, this would be an AI that I would love to work with!
What are HR professionals who used AI saying?
To explore the state of talent acquisition in organizations today, in November 2022 Harvard Business Review Analytic Services conducted a global survey of 326 respondents familiar with their organization’s talent acquisition process.
Lackey said that one factor causing dissatisfaction with the experience among hiring managers is the volume of tedious, low-value tasks.
“Many hiring managers are bogged down with so many administrative responsibilities like paperwork and scheduling that it takes away from where they could be having more of an impact— like spending more time with people or on strategy.” Jeffrey Lackey of JKL Advisors
“People skills are fundamental for successful talent acquisition. Gen AI can free up time for talent professionals to concentrate on activities that demand emotional intelligence and interpersonal abilities. However, the resources and knowledge required to develop, implement, and maintain AI solutions are substantial. Partnering with providers that have in-depth AI expertise allows organizations to reap the benefits of AI in a smart and cost-effective way.” Jo-Ann Feely, Global Managing Director of Innovation, AMS.
“We firmly believe that this new generation of AI will revolutionize HR and all aspects of management. Today, second generation AI is being used for many new applications: diverse recruiting, internal mobility, career planning, capability development, and even helping to simplify and improve the company’s job architecture. Soon we will see applications in pay equity, promotion, and even performance management” Josh Bersin, Corporate Talent, Learning, and HR Technology analyst
And a final quote from a CEO who has every reason to be optimistic as his company has already skyrocketed
“The future belongs to those who embrace AI and use it to their advantage.” Jensen Huang Founder and CEO of NVIDIA
How companies are implementing AI in their HR processes
Companies have two primary approaches to adopting AI.
Buy AI Solutions
Most of the companies already using AI in HR are using it as part of their ATS-added features. Most of these features are addons and help them to automate certain tasks like writing better job descriptions, writing social media posts, scheduling appointments, and getting chatbots to answer common questions about jobs instead of having a recruiter perform these mundane tasks. It’s certainly a benefit, especially for high-volume hiring. CV screeners are a norm now but there are always questions about transparency and lack of bias on these assessments.
Build Custom AI Solutions
Some big companies with big contracts with the Big 4 consultancies have started trying to build AI automation for their HR. This is a very expensive and timeconsuming process but the long-term benefits are already there.
This solution is not viable for smaller companies, individual recruiters, or staffing agencies to move forward. Nevertheless, the technology is getting more and more efficient and cheaper as time passes. I believe that this technology will be democratized soon.
Let’s look into some reports of big companies building custom HR AI solutions and the results they report. This might give us some ideas
MASTERCARD
Mastercard reported using AI to create automation on interview scheduling and creating personalized talent outreach in their talent-nurturing community. These resulted in more profiles in their talent pipeline (9x), faster interview scheduling (85%), and higher conversion rates for candidates to applicants (11%).
ELECTROLUX
Electrolux reported using AI to do faster screening, candidate-to-job fit scoring, and one way interviews. This resulted in 9% increased time to hire, an 84% increase in application conversion rate, and 51% less dropped applications.
KUEHNE+NAGEL
They used AI to create an internal talent marketplace and match existing employees with career opportunities. These resulted in an increased conversion rate for internal candidates by 22%, decreased time to fill for internal requisitions by 20%, and achieved a 74% employee satisfaction rate with the experience.
BROTHER INTERNATIONAL CORPORATION
They built a career site with a chatbot that engaged with interested candidates to help them convert to applicants by syncing with their CRM to start nurturing people who were captured as leads with this career site AI chatbot. The result they reported are: a 140% increase in completed applications, a 45% increase in total page views, a 40% increase in job seekers, a 15% increase in returning job seekers, and 25% decrease in time to fill
STANFORD HEALTH CARE
They also built a chatbot on their career site to help drive more candidates to applicants. The results they report are 2,856 meaningful career conversations with candidates and reduced days to offer by 41 days. It also helped them to re-engage with former applicants to fuel immediate pipeline increases.
THERMO FISHER SCIENTIFIC
They also built an internal careers site that was enabled by AI to help cover positions by internal applicants. They report that started filling their roles 40% by internal applicants
Conclusion on big corporations applying custom AI in HR
In a nutshell, big companies are applying AI on their HR to help their high volume hiring with 2 options:
1) building chatbots to drive engagement with their career sites and help candidates apply easily and
2) building internal career sites to help cover positions by internal hiring.
In my opinion, even though these options can be helpful, the AI technology is not accessible enough to make a significant difference in recruiters’ daily time-saving efforts. The whole point of AI should be to help me out with my boring everyday thinking tasks, so I can focus on more personal stuff that involves human skills like empathy and emotion.
I really hope that in the next couple of years, we’ll get there. I’m sure we’ll have AIs that can take care of all our boring recruiting tasks, making us more efficient, productive, and profitable.
That way, we’ll all be happier at work and can experience the cognitive revolution the way it was meant to be. Free to do what we do best as humans!
What do you think? What is your experience with AI in your recruiting ops? Let me know in the comments below.
Hope you found this article useful. Let me know what else you would like me to write about in the comments below.
Best,
Alex Louizos
AI engineer, Founder
