Automated Recruiting Systems Are Dismissing Millions Of Talented Applicants, Says Report
If you’ve applied for a job, particularly at a large company, in the last few years, you’ll likely be aware of the terrible state of recruiting. Resumes seem to disappear into limbo for months on end, ambiguous job descriptions, and companies that aren’t even currently recruiting but still create listings are just the start, all before being rejected for an unknown reason.
Part of the cause of this almost impossible labor landscape is automated recruitment software. These algorithms sift through hundreds or even thousands of applications and shortlist those they deem worthy, often passing up perfectly viable candidates due to small technicalities.
Now, a new report by Harvard Business School has highlighted just how much damage they are doing to the labor system, and how they are contributing to a “broken” hiring system.
“Companies are increasingly desperate for workers. As they continue to struggle to find people with the skills they need, their competitiveness and growth prospects are put at risk,” reads the opening of the report.
“At the same time, an enormous and growing group of people are unemployed or underemployed, eager to get a job or increase their working hours. However, they remain effectively “hidden” from most businesses that would benefit from hiring them by the very processes those companies use to find talent.”
The report involved a large survey of 8,000 “hidden workers” and more than 2,250 executives across the US, UK, and Germany. Hidden workers are considered as people that wish to work, but are unable to do so due to the job market or personal reasons. Through the survey and taking an in-depth look at the employment scene, the researchers discovered two crucial things: firstly, workers were struggling to find work before the pandemic hit, hinting that the problem is not solely due to lockdowns; and that the AI systems firms are using are preventing millions of talented individuals from ever seeing an interview.
These systems in question are either Applicant Tracking Systems (ATS), Recruiting Managing Systems (RMS), or both used in conjunction. In middle- and high-skilled jobs, over 90 percent of employers in the survey stated they used RMS to filter or rank applicants.
Scouring through resumes to identify key skills and qualifications, these systems allow large firms to streamline their process and find suited individuals fast, but they come with a host of issues. The report does not hone in on a specific reason why these systems can miss viable candidates, but they suggest that systems often sort applications into "good" and "bad" categories over simple discrepancies. Ludicrously, they may even filter candidates out for not having a highly specialist skill implicitly stated on the resume, or if they answered honestly to a recruitment form, instead of ticking "expert" on every skill requirement. Even the employers agree – these systems are missing talent.
“A large majority (88%) of employers agree, telling us that qualified high-skills candidates are vetted out of the process because they do not match the exact criteria established by the job description,” states the report.
To remedy the loss of talent through electronic systems, Harvard has some recommendations.
The companies must first re-evaluate their job descriptions. Instead of constantly adding skills that are "necessary" to get an interview, refresh the descriptions with a small number of “must-have” skills that allow worthy candidates opportunities. They should also change the recruitment AI, by converting negative filters, that de-rank applicants based on missing skills or employment gaps, into filters that rank applicants higher for those that fill the role the best. This way, the best candidate would be found out of the pool, instead of instantly disregarding candidates for often menial issues.
Here’s why AI is making HR pros indispensable
Artificial intelligence has the potential to help human resource professionals make a massive impact on their company’s culture, performance, efficiency and diversity. When embraced and applied properly, AI can become a secret weapon for hiring professionals in avoiding the obligatory, monotonous tasks they’ve always resented, while enabling hiring teams to unearth things about their candidate pools that would otherwise remain unseen.
Here are a few ways that AI can help HR pros become the best versions of themselves:
Expand the pipeline
Traditional methods of recruiting force us to narrow the pipeline significantly. Before AI, there simply was no way to fully consider every candidate to determine relevant experience, perceived fit or background. Instead, we were forced to cut down the talent pool to a size that could realistically be evaluated, and we did so using primarily non-predictive and often biased information depicted on a resume. Now, AI has an unparalleled ability to go beyond these traditional factors and interpret massive amounts of additional data points.
When paired with pre-employment assessments, AI can help you consider personality traits, workplace competencies and cognitive abilities that are normally only observable to recruiters during the interview process, or sometimes even post-hire, when it’s too late. Instead of relying solely on resume factors to determine which candidates to bring into the process, recruiters can expand their consideration to include these other, often more predictive factors, of on-the-job success.
This type of expanded consideration leverages technology to broaden our pools to those candidates we might have never otherwise considered, while at the same time shortening the amount of time required to thoroughly evaluate them. It also results in increased diversity.
Drive diversity
When we begin to look outside of the resume to determine potential fit, we open ourselves to candidates from more diverse backgrounds. Students from higher-income backgrounds generally achieve higher SAT scores, are admitted into more elite colleges and achieve higher GPAs. But as mentioned, these types of success metrics don’t necessarily correlate with success in the role.
Using AI to determine suitability, hiring managers can also help reduce the systemic bias that often accompanies hiring decisions. When those in charge of hiring assume traits or tendencies about a candidate that may not be accurate, this can cause organizations to miss out on high-potential talent. The goal with bias reduction, beyond being fairer to the candidates, is to be data-driven, eliminate assumptions and ensure you hire the objectively best candidate for the role.
Keep in mind, AI models are not always or inherently objective, and they must always have human oversight and rigorous testing to ensure bias is not being perpetuated. When creating algorithms, skilled AI practitioners will know how to mitigate bias and remove adverse impact from the recruiting ecosystem.
Instituting AI-enabled recruiting does require a time investment up front. It requires data collection, data adjusting, model building and model testing, but ultimately saves companies money and time in the long run.
Save time and money
HR professionals simply don’t have enough time to thoroughly evaluate every candidate and ensure the best hiring decisions, especially in situations where finding a candidate is urgent. Using technology such as AI can help dramatically free up their schedules, enabling them to spend the limited time they have on engaging with talent and the teams that need them.
If companies can determine, through proper testing and evaluation, which combination of psychometric and cognitive factors they need to successfully fill a role, AI can easily mine your general applicant pool for candidates who meet those criteria, and it can help avoid costly hires that may not work out long-term. This type of AI that joins forces with industrial-organizational psychology is a seamless way to ensure hiring managers are paying attention to the things that matter most, quickly and in a manner that causes no adverse impact.
Ultimately, AI is never going to replace HR professionals, but it can make them more strategic and indispensable contributors. By using this technology in combination with their expertise in candidate engagement, interpersonal skills and organizational knowledge, hiring managers will be well on their way to creating lasting and tangible impacts within their organizations.
Improving the employee experience in a post-Covid world
Some call it an employee’s journey in their current workplace; others describe it as uncovering the tools and culture employees need to do their work successfully. But whatever you call the employee experience, it is driving employers even harder to better understand how they can offer a much more positive work environment — no easy task, especially in the wake of the past 16 or so months as COVID changed the workplace.
“I believe the entire dynamic and what employee experience looked like shifted since the pandemic,” says Sugi Venkatesh, division vice president – HR, for Global Product and Technology on ADP’s Human Resources team. Venkatesh adds that during the pandemic, ensuring a positive employee experience not only meant the workforce was engaged and taking care of customers, but it also became the only way to stay in business.
“Many organizations went from employee experience being a focus area to it being the top priority, with real dollar investments,” he says, adding that the paradigm shift also brought with it a need to accelerate the employee experience through technology.
“When the world went remote, we became a 100% reliant on technology — technology as a medium of interaction and engagement; technology as a tool to perform one’s job effectively in this new environment, and technology as a vehicle to make the job better and more digital,” Venkatesh says.
With that, he believes today there is building pressure on HR leaders and their organizations to expect that tech tools enhancing employee experience are integral within their HCM systems.
“With a distributed workforce, there have been huge changes,” Venkatesh says,
mentioning issues such as how the work happens; how employees engage; how leaders lead and manage teams and, finally, the at the core of it all is HR’s practices, processes, tools, programs and policies.
The employee experience: Technology
According to Steve Boese, president and co-founder of H3 HR, a full-service HCM advisory firm and HRE contributor, prior to the pandemic the HR industry had already begun to talk about and focus on EX. In some respects, he says, it was an outgrowth or perhaps an evolution of the concept of employee engagement, which “has been discussed and debated forever.”
For Boese, the main theme was that despite years of attention and focus, for the most part measures of employee engagement have hardly improved.
“Employee experience emerged when HR leaders and HCM technology providers began to assess HR and workplace technologies compared to the best consumer and personal technologies,” he says.
“Mostly, HR technologies were oriented towards completing transactions, delivering information, enforcing rules and standards, and optimizing processes.”
Boese explains that while all valuable and important goals, these at the surface are not terribly interesting, compelling and relevant to most employees.
“Employees look to HR and workplace technology optimistically to help them achieve their goals, improve their skills, and enhance their career development,” he says, adding that, pessimistically, employees will settle for HR and workplace technology that is relatively easy to use and does not waste their time or cause frustration.
“When HR leaders and HCM technology providers turned their attention to meeting the true, higher value employee wants, the employee experience movement began to take hold and gain momentum,” he says.
Boese says that many of the recent HCM technology developments that place improved EX at the forefront of their design were probably already under development prior to the start of the pandemic — the events of 2020 and now continuing into 2021 have certainly accelerated these efforts.
“There is a combination of drivers at play that led to this increased focus and attention to employee experience and more employee-centered design in HCM technology,” he says, noting that the massive and sudden disruption of work, the closing of many workplaces, and the stress placed on workers or almost all organizations gave rise to demonstrable increases in employee stress, uncertainty, and even fear — fear of their jobs going away, fear of the growing health crisis, and concern for their families.
With that, Boese says, employers and their HR leaders had to quickly respond to these challenges, and in an environment where almost all workers who could pivot to remote work did, and those who could not were facing unprecedented conditions and even potential health risk, HR leaders turned, largely, to technology to help navigate these challenging times. And what organizations needed, and what HCM technology providers had to deliver, were tools that placed the employee and their needs first and not the transaction or data update.
“Employees needed tools to help them manage all the disruptions in their work lives and their personal lives, and they looked to their HR leaders to deliver. So yes, the pandemic has increased the focus on employee experience in a meaningful way,” Boese says.
Today, what observers like Boese are seeing is HCM technology providers designing and architecting solutions that are meant to provide support, resources, and improved experiences for employees.
So rather than focus on the completion of a transaction, or an update to a data field in the HR system, as was the primary purpose of employee self-service, the new technologies are built to help employees with what really matters to them – making a better-informed decision about a benefits enrollment, surfacing a learning and development module as and when it’s needed, or even simply reminding them to take care of their own physical and mental well-being.
Boese offers a simple example to understand the how employee experience impacts HCM tech. Take traditional self-service events, like an employee promotion or a relocation to a new office. Traditional self-service only processes the transaction. On the other hand, new, employee-centered HCM solutions provide employees with the resources and information they need to make these changes easily and successfully.
These tools, Boese says, will suggest and enroll the employee in training courses needed to succeed in their new role, surface resources to help them more easily adapt to their new work location, like suggesting people they can contact for support and networking — and even model their new net pay based on changes in salary and taxes in their new location.
“Think self-service, but self-service designed for the employee, not the HR department,” Boese says.
EX and HR tech: The ‘humanity’ factor
Boese hits on an important aspect of the evolution of HCM technology. Jason Averbook, the industry analyst and co-founder and CEO of Leapgen (and also an HRE contributor), spends much of his time pondering about and consulting on how the humanity of technology can play a critical role in the increasingly critical EX trend within HCM and other HR-related tech solutions.
“Of course, technology is important. But ensuring that any technology deployed in the HR realm has a strong focus on the human side of the equation is indispensable,” Averbook explains.
“In the past, tools designed within HR were for HR people, but fell short for the rest of the workforce,” he adds. “When one thinks about design, the focus should be about designing HR tools for all humans.”
The employer’s responsibility, then, is to ensure that employees are allowed to be human when they need to utilize HR-related technology, Averbook says.
“The responsibility as an employer is that we actually engage people in a human conversational-type way, not a transactional-type system way,” he says. “When you break it down, it has to be designed for them in a way that’s natural, that’s frictionless, that meets them where they are and allows them to be what they are, and that is human.”
Jess Von Bank, Averbook’s colleague at Leapgen, where she serves as Head of Marketing/Digital Transformation/Now of Work, compares the current evolution of EX to making a film.
“For the next year or two,” she says, “we’re making a movie and we’re all actors in that movie. And we’re going to watch the movie in five years and look back and say, “What did we do between 2020 and 2023 to really change work?”
Von Bank says some employers actually will embrace massive change; others, unfortunately, will do nothing.
“Those that do nothing are really going to lose out. I think they’re going to be non-post 2020 compliant, and people aren’t going to want to work for them,” she says.
Adds Averbook, “It’s been happening outside of work for quite a while. I’ve often said it’s 2021 outside of work, but what year is it inside of work? In too many organizations, it feels like 2000 inside of work because we have really ignored and have done a disservice to employees in providing them the tools they need to bring their best selves to the office.”
“We’re hopeful for change. I hope we all learned enough and the pandemic has lasted long enough that we truly won’t remember and don’t go back to normal,” Averbook says. “We need to say, ‘Let’s design something new. Let’s make this better than what it was.’ We have more options available to us when it comes to HCM and the employee experience. So we need to use them to bring the humanity to our solutions.”
Talent development & culture: Scratching the surface
When it comes to the employee experience, a third critical component must happen within talent management while, at the same time, building a culture that embraces and improves EX, according to Ben Brooks, founder and CEO of Pilot Inc., a career management technology platform designed to support and enable both business leaders and employees to make work more satisfying and fulfilling.
Brooks says, unfortunately, a majority of employers have not delivered what’s needed when it comes to the employee experience within managing talent and creating a culture people want to be part of — one where they are more likely to stick around to explore and enjoy long-term.
“Employee expectations began to change when their consumer lives all of a sudden flipped, and they had way better tech outside the office than inside the office,” Brooks says.
At the same time, employers convinced themselves that the employee experience meant things like holding a volunteer day, designating D&I themed months, or offering workplace perks.
“This was often driven by headquarters, this notion of creating a standardized employee experience,” he says. “So the employee experience was very seldom personified, differentiated or configurable. It has been one size fits none, you might say.”
As times changed and remote work began heating up, while talent attraction and retention transformed into an even more serious challenge, employers started to talk about employment marketing, recruitment marketing and the employee value proposition — the idea that they could offer more than just new tech or a high-end workstation.
“It started to get more into culture and perks,” Brooks says. “But it still was designed around a fairly top-down, here’s what you get model and mindset.” For example, if you worked at a large tech company and you have a baby, everyone might get a swag baby kit.
Then, 2020 dawned and COVID accelerated remote work for many industries and truly changed the EX dynamic. In fact, Brooks says, the EX that most companies were starting to design around was an office-based experience, what he calls a “3D experience.” It could mean creative cafeteria menus, guest speakers, or an employee getting their dry cleaning done or oil changed while in the office.
“COVID comes along and suddenly the employee experience goes from 3D to 2D,” Brooks says. “It’s only what’s on our screen. There are no snacks, no cool speakers. There’s no retreat in the mountains or massage room. Many companies that had invested heavily in employee experience had invested in a 3D experience, but COVID has changed the game.”
With that, the importance of tools and software on boosting the employee experience has gone up significantly in the last year, mainly because the density of tools as a percentage of the employee experience is much greater than it has ever been.
Brooks notes there still is a strong association with place as a proxy for employee experience, adding that companies don’t typically have effective digital town squares as part of the experience upon which to build a culture in this 2D workspace.
How do employers distinguish your employee experience, maintain a strong company culture and talent management strategy under these circumstances?
“It’s not going to be just the tools,” he says. “Employers will need good digital community management, high adoption rates and a tech configuration to make those tools usable while having effective oversight of them.”
“If you haven’t automated and digitized, that’s shame on you at this point,” Brooks says. “It’s going to be hard to differentiate. So when you think about talent and culture, if you think about the belonging and the culture side of it, you must create more connectivity.”
One crucial factor, Brooks says, lies with managers. Employee development is about making someone better but, he says, by and large managers have shied away and are largely unequipped with having employee development conversations virtually. They used to happen over lunch or a beer, or in the office or a conference room.
“Employees join organizations and leave managers,” he says, noting a top three finding of every engagement survey he’s ever seen is either manager feedback, career development, or growth and learning. “Those are always a top key driver of engagement and a low scoring category, for almost every company I’ve ever seen.”
Therefore, Brooks says, the employee experience — with career development and with talent development top of mind — is going to require different managerial behaviors.
“If a manager is a not doing his or her job, it won’t matter if they have a new iPhone, a great chair and a volunteer day,” he says.
It’s time, Brooks says, to see employees as a customer of the company.
“That will be the breakthrough for companies,” he says. “Sometimes an employer will say their culture is customer-centric, but it’s really not. It’s just more of the paternalistic model.”
The true employee experience evolution will be to take all of the great work HR figured out in tech and create an actual customer-centric employment model as the foundation of talent development and culture.
“We’re just scratching the surface,” Brooks says. “Anyone who says that they’ve completely cracked the employee experience is not being honest, because there are very few employees who will say, ‘I would never quit under any circumstances.’ That will never change, but with effective talent and culture development, it can be greatly minimized.”
“Organizations and HR leaders have had to rethink their approach and meet the employees where they are,” says ADP’s Venkatesh, adding that it means tech enhancements that can help HR and employers manage engagement, development, and turnover with dynamic teams, where the work happens.
“It requires tools that can make checking in and assessing associates’ needs easier, tech that has AI capability that can anticipate employee needs,” he says. “No doubt HCM systems can be the catalyst to this change, but only if the truly effective tools in meeting those goals and needs are baked into it.”
Opinion: AI Might Eliminate Humanity in Human Resources
According to recent findings, more and more human resources professionals utilize artificial intelligence in evaluating employees. But such tech can lead to unfair employee appraisals or outright discrimination.
(TNS) — With 86% of major U.S. corporations predicting that artificial intelligence will become a “mainstream technology” at their company this year, management-by-algorithm is no longer the stuff of science fiction.
AI has already transformed the way workers are recruited, hired, trained, evaluated and even fired. One recent study found that 83% of human resources leaders rely in some form on technology in employment decision-making.
For example, at UPS, AI monitors and reports on driver safety and productivity, tracking drivers’ every movement from the time they buckle their seat belts to the frequency with which they put their trucks in reverse. At IBM, AI identifies employee trends and makes recommendations that help managers make decisions on hiring, salary raises, professional development and employee retention. Even NFL teams are using AI to assess player skills and make injury risk assessments during the recruiting process.
Amazon, a pioneer in the use of AI, has gone all in by integrating the technology throughout its entire company, especially in human resources. Just a few months ago, contract employees for Amazon claimed that they were being summarily fired by automated emails for failing to meet preprogrammed productivity bench marks.
In fact, Amazon’s use of an electronic tracking system made headline news for the way it monitored worker productivity and, allegedly, automatically fired employees it deemed were underperforming.
According to a 2018 letter written by attorneys for Amazon, if an employee spent too much time off task, the system “automatically generate(d) … warnings or terminations regarding quality or productivity without input from supervisors.” An Amazon spokesperson subsequently clarified, “It is absolutely not true that employees are terminated through an automatic system. We would never dismiss an employee without first ensuring that they had received our fullest support, including dedicated coaching to help them improve and additional training.”
These reports highlight the need for employers to find the right division of labor between artificial intelligence and human resources personnel — between using AI to improve human decision-making and delegating decision-making entirely to algorithms.
Using AI to make decisions ordinarily made by HR professionals can have significant legal ramifications, so employers should exercise caution when deciding when — and whether — to hand such matters over to algorithms. There may be cases in which compliance with federal anti-discrimination law requires human intervention. This is frequently the case when it comes to workplace accommodations for pregnant, disabled and religious employees.
The Americans with Disabilities Act requires covered employers to provide reasonable accommodations for individuals with disabilities. Similarly, under Title VII of the Civil Rights Act of 1964, employers cannot discriminate on the basis of pregnancy and religious practices of employees. Generally, these accommodations are granted through an interactive process between employer and employee: two humans.
Most of the time an employee initiates the interactive process by notifying the employer of the need for a reasonable accommodation — a conversation that can be sensitive, personal and even difficult for employees. If an employee’s primary interface with his employer is an app or an algorithm, initiating that process may be daunting and employees may not be willing to disclose some of their most personal and protected issues to a chatbot. For that matter, it may not even be clear to the employee who the appropriate point of contact is.
It may come as a surprise that there are some instances in which an employer may be expected to initiate the interactive process without being asked — for example, if the employer knows that the employee is experiencing workplace problems because of a disability. Under those circumstances, the process often starts when a supervisor senses, with their own eyes or judgment, that an employee needs intervention.
Accordingly, employees and civil rights advocates have voiced concerns about whether the use of AI in employment decision-making allows for a process that is so heavily dependent on personal interactions. An algorithm, no matter how sophisticated, may not be capable of the sort of sensitivity and responsiveness needed to meet the needs of employees in need of accommodations.
Whether employers rely on algorithms, human HR professionals, or both, they must develop and implement policies to handle various, more nuanced employee situations. If an employer uses AI for reviewing performance and tracking productivity, the employer should ensure that their AI system allows for — and accounts for — reasonable accommodations related to disability, pregnancy and religious observance.
Above all, employers must inform their employees that the requirement to engage in an interactive process for an accommodation under the ADA and Title VII still applies when the employer uses AI to track productivity.
While AI is becoming mainstream technology in the workplace, discrimination-by-algorithm must not.