Applicant Tracking System

What is an applicant tracking system?

An applicant tracking system is a type of HR software that automates hiring and onboarding processes. The acronym ATS is used in the industry for both the singular and the plural. Applicant tracking systems (ATS) are similar to customer relationship management (CRM) platforms except they manage job applicants rather than customers or leads. The first ATS came on the market in the late 1990s. With the availability of cloud computing a few years later, most existing ATS vendors adopted the Software as a Service (SaaS) model. In addition, the niche exploded with hundreds of new providers. This has greatly expanded the use of ATS because they are now affordable for companies of all sizes. In 2018, GlobalNewsWire reported the ATS market valued at 1.26 Billion, and projected a CAGR of 8.0%, for a valuation of 2.34 billion by 2026.

How does an applicant tracking system work?

An ATS creates a database of candidate resumes and applications that users manage digitally. Users can set up workflows with task reminders for hiring team members, manage applications, communicate with candidates, post job advertisements to job boards, manage interviews and collaborate with the hiring team.

An ATS is both inward- and outward-facing. When an applicant sees a job posting on a third-party job board and clicks the link to apply, they will enter a company’s ATS if the company uses one. Corporate careers pages can be managed in an ATS. Users send and track emails and offer letters to candidates in an ATS.

What tools/features does an ATS have?

  • Custom workflows with task reminders
  • Job requisition templates
  • Job description templates
  • Structured interview script templates
  • Single signon job board posting
  • Prescreening questionnaires
  • Branded recruitment marketing
  • Job board analytics
  • Email templates
  • In-application texting
  • Application/resume parsing
  • Hiring stage change triggers
  • Boolean resume/application searching (AND/OR syntax)

Integrations with third-party work tech expand the capabilities of an ATS. Common integrations include job boards and job sourcing platforms, background screening services, video interviewing platforms, calendaring and scheduling tools, analytics platforms, and file storage programs. Of course, some ATS have one or more of these tools built into the software.

Why do companies use ATS?

In the past decade, many companies and staffing agencies have adopted an ATS to find more candidates. The labor market has continually tightened since the Great Recession of 2008. Low unemployment combined with skills gaps have contributed to the talent shortage. An ATS expands a company’s recruitment marketing.

How can an ATS help improve hiring processes?

A cloud-based ATS provides a mobile-friendly hiring experience which is important because a majority of job seekers use a mobile device in their employment search. An ATS also helps recruiters regularly communicate with candidates using emails and texts. Mobile accessibility, convenience and frequent communication strengthens the company’s employer brand by providing an applicant-centric hiring process.

ATS can store hundreds of applications for multiple positions. This helps companies manage high-volume hiring in a single, centralized database.

As the labor market has become increasingly competitive, many companies have taken steps to shorten the hiring process. With automated screening and filtering, an ATS helps recruiters quickly isolate a pool of qualified candidates before hiring team members need to spend any time reading resumes. Then, recruiters can use the ATS to move the promising candidates through the subsequent stages as quickly as possible.

An ATS also helps companies comply with Equal Employment Opportunity Commission regulations and others that govern hiring practices.

ATS analytics track recruiting metrics such as time-to-hire and cost-per-hire. They also measure the performance of job boards, social media sites, and employee referral programs to identify the most effective hiring channels.

Who uses applicant tracking systems?

ATS work tech users include:

  • Independent recruiters
  • Staffing agencies
  • Executive search firms
  • Large enterprises
  • Small and medium-sized businesses (SMB)
  • Enterprise organizations

It is estimated that 98% of Fortune 500 companies use an applicant tracking system. While adoption is lower among small – medium-sized businesses, it is increasing steadily.

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