99% of Fortune 500 companies use an Applicant Tracking System (ATS), according to JobScan. But is an ATS worth it for your small or midsize business? Applicant tracking systems are designed to help employers manage their recruitment process, from posting job ads to screening resumes and scheduling interviews.  
 

In this article, we’ll take a closer look at ATS to determine whether they are an effective tool for employers and go over tips on streamlining the hiring process.  
 

If you’re interested in improving your hiring and recruitment process, connect with an expert.  

 
 What is an Applicant Tracking System (ATS)? 
 

An Applicant Tracking System is a software application that automates the recruitment process for employers. The system collects, sorts, and filters job applications and resumes to help employers find the most suitable candidates for their job openings. These systems are commonly used by companies of all sizes, from small startups to large corporations. 

 

The ATS works by scanning resumes and job applications for specific keywords and phrases that match the job requirements. The system then ranks the resumes based on their relevance to the job opening, making it easier for employers to identify the best candidates. ATS can also automate tasks such as scheduling interviews and sending follow-up emails to candidates. 

 

Advantages of Using an Applicant Tracking System 

 

You posted a job ad for a graphic designer, and, great news, you received over 300 applications in just two days! The bad news is that you or your hiring manager must sort through every application by hand. This is exhausting and can be overwhelming. 

 

This is where an Applicant Tracking System can help. For instance, you can enter words that you’d expect to see on a qualified candidate application, such as the names of popular graphic design tools. Or if you can only employ folks in certain states, you can filter by location. 
 

Below are a few ways an ATS can help your business.  

 

Save Time 

One of the most significant advantages of using an ATS is that it saves time for employers. With an ATS, employers can quickly screen resumes and identify the most suitable candidates for their job openings, saving hours of manual work. 

 

Better Organization 

ATS helps employers to organize and manage their recruitment process better. The system allows employers to track the progress of each candidate and quickly identify the best candidates. 

 

Improved Candidate Experience 

ATS also helps to improve the candidate’s experience. By automating tasks such as scheduling interviews and sending follow-up emails, candidates can receive timely and efficient communication from employers. 

 

Compliance with Labor Law 

ATS helps employers to comply with labor laws, such as Equal Employment Opportunity (EEO) and affirmative action (AA) regulations, by providing data and analytics on their recruitment process.  

 

Disadvantages of using an Applicant Tracking System 

Below are a few drawbacks to take into account when it comes to automating the hiring process.  

 

Lack of Personal Touch  

One of the biggest disadvantages of using an ATS is that it lacks a personal touch. Job seekers may feel that their application is not being reviewed by an actual person, but rather by a machine that doesn’t understand their qualifications or experience. 

 

Keyword-Focused 

ATS places a strong emphasis on specific keywords and phrases, which can lead to qualified candidates being overlooked if their resume doesn’t contain the necessary keywords. 
 

For instance, if a position calls for a creative type, they may format their resume in a way that the ATS cannot accurately read. In fact, according to Zippia, 61% of hiring managers believe a more customized resume helps boost an applicant’s chances of getting the job.  
 

If the ATS cannot identify the format of the resume, then it could lead to your business missing out on potential talent.  

 

Technical Issues  

Technical issues with an ATS can also create problems for job seekers. If a candidate’s resume is not formatted correctly or contains incompatible file types, the ATS may not be able to read it, resulting in the candidate being excluded from consideration. 

 

Inaccurate Screening 

In some cases, ATS may not accurately screen candidates. This can result in qualified candidates being overlooked or unqualified candidates being advanced in the recruitment process.  

 

For instance, Zippia reports 77% of resumes contain some form of typo or grammatical error. Typos and bad grammar are certainly something to review. However, if the position is unrelated to these skills, they may not be worth excluding potential talent for.  

 

Are Applicant Tracking Systems Worth It? 

 

So, are Applicant Tracking Systems worth it? It depends on your needs and goals. For large organizations that receive hundreds or thousands of job applications, an ATS can be a valuable tool to manage the recruitment process efficiently. It can save time, improve organization, and help to identify the most suitable candidates. 

 

For smaller organizations or those with fewer job openings, an ATS may not be necessary. These companies may be better off manually reviewing resumes and job applications, as it allows for a more personalized approach and the opportunity to identify candidates who may not fit the specific keyword criteria. 

 

Although, for small businesses focused on growth, implementing an ATS may be the magic tool to recruit the right talent to reach the next level. Our 2023 HR Survey of over 2,000 small businesses in the US found that the majority (57%) of Growing Businesses use applicant tracking software to filter job applicants. Conversely, just 40% of businesses that failed to grow last year used applicant tracking software.  

 

Tips for Small Businesses Using Applicant Tracking Systems 

 

As a small business owner, you understand the importance of finding the right employees to help grow your company. However, recruiting and hiring can be time-consuming and expensive. That’s where an Applicant Tracking System (ATS) can help streamline the hiring process.  
 

Here are some tips for small businesses to effectively use an ATS: 
 

1. Define your hiring needs. Before implementing an ATS, clearly define your hiring needs and job requirements. This will help you choose the right system that meets your business needs. 

2. Use keywords. Use relevant keywords and phrases in job postings to attract the right candidates. An ATS can scan resumes and match them to job descriptions based on keywords. 

3. Simplify the application process. Make the application process easy and straightforward. Lengthy and complex applications can deter qualified candidates from applying. 

4. Personalize communication. Use the ATS to personalize communication with candidates. Send automated email responses acknowledging receipt of their application, provide updates on the status of their application, and send rejection letters. 

5. Stay organized. An ATS can help you stay organized by tracking candidate information, resumes, and correspondence in one central location. 

6. Keep candidates engaged. Keep candidates engaged throughout the hiring process by regularly updating them on the status of their application and scheduling timely interviews. 
    

By following these tips, small businesses can maximize the benefits of using an ATS to streamline their hiring process and find the right employees for their company. 

 

Conclusion 
 

In conclusion, Applicant Tracking Systems can be a valuable tool for employers to manage their recruitment process effectively. While they may have some disadvantages, such as the lack of personal touch and the potential for inaccuracies in the screening process, they can save time, improve organization, and help to identify the most suitable candidates. 

 

In addition, utilizing an ATS can help ensure your business is compliant from the moment a person applies to join your team.  

 

Explore Asure’s recruiting and applicant-tracking software for small and medium-sized businesses.