Finding the right person for a job can seem impossible when hundreds are applying for a single position at once. Many employers have turned to software to whittle those candidates down, but there is a problem: The software can snub perfectly good workers.
So-called application tracking systems, the official term for resume-filtering software, were designed to help companies cope with the growing number of job applications flooding in for each vacancy over the past two decades.
Nearly all Fortune 500 companies use this kind of software for recruiting, according to a Harvard Business School study released earlier this month.
The study found that millions of qualified jobseekers were being rejected at the first stage of the application process because they did not meet certain initial criteria set by the recruitment software.
For example, the software might put someone in the “no” pile if it detects a one-year gap in employment, disadvantaging people who have been on long-term parental leave or are veterans. The software also sometimes uses proxies like a college degree to assign attributes like work ethic, barring people who might have gained those qualities from other kinds of life experience.
This is something many in the recruitment industry have known for years. While hiring software is often useful, it can also be inflexible, miss valuable traits, such as soft skills, and inadvertently hinder the job market. Smaller companies in particular need to reconsider their growing use of algorithms for finding talent, especially in an increasingly tight job market.
Today’s global labor shortage has, uniquely, coincided with high unemployment rates. In the US, for instance, job openings between the fourth quarter of 2019 and May this year rose by one-third, yet more than 9 million people remained unemployed, according to Deloitte Insights.
However, although they were designed to improve hiring, algorithms can exacerbate the talent shortage by rejecting millions of candidates at the outset, according to the Harvard study.
These systems are also at risk of being gamed. For years a popular method for getting through recruitment algorithms has been to fill a resume with key words that are relevant to the job, in white font. That way only the algorithm detects them and pushes them further along in the interview process, potentially over better fits.
Software is getting better at looking out for keyword spam, but that does not stop people from trying, said Lee Tonge, founder The CV Store, a British resume writing agency.
Some colleges are even preparing their students to deal with hiring algorithms. About 250 universities across the US, Canada, the UK and elsewhere use a start-up called VMock Inc to help their students tailor their CVs with software that will, with a forthcoming update, be able to analyze a job description and then suggest changes to a resume to better reflect what is wanted.
It could, in theory, help a graduate send out 20 different resumes tailored to 20 different job descriptions, VMock founder Salil Pande said.
However, that might also disadvantage other, just as promising, candidates who do not have access to such tech.
To be fair, hiring algorithms can be useful. They can ignore gender, race or schooling to help employers seek out a more diverse array of candidates, and large companies especially can justify using them to parse hundreds of applicants.
However, employers should take some precautions.
The Harvard study suggests audits to ensure that algorithms are not inadvertently rejecting perfectly good candidates from the outset.
Tonge has a good recommendation for smaller firms too: If you can, drop the resume screening software altogether. You would have a better chance of finding the right people by looking at their resumes yourself.
Parmy Olson is a Bloomberg Opinion columnist covering technology. She previously reported for the Wall Street Journal and Forbes and is the author of We Are Anonymous.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
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