min read

AI in Recruitment: The Complete Guide for 2021 and Beyond

This comprehensive guide explores the benefits, use-cases, and purchase considerations for AI in recruitment.

AI in Recruitment: The Complete Guide for 2021 and Beyond

Artificial intelligence (AI) has found wide-scale adoption within the recruitment and onboarding function. From resume parsing to behavioral analytics and programmatic job advertising, AI is transforming how employers engage with candidates.

This guide to AI in recruitment will explore the benefits, applications, and how to select the right solution for your business in 2021 and beyond.

Artificial Intelligence in Recruitment: What Is It and How Does it Work

Artificial intelligence is a branch of computer science that leverages unique self-learning algorithms to enable machines to perform a wide range of tasks that would otherwise have required human intelligence. Some of the most popular technologies underpinning AI in recruitment include machine learning, deep learning, natural language processing (NLP), computer vision, language translation, and neural networks. In the recruitment context, AI helps organizations automate and streamline repetitive tasks, analyze data, improve workflows, and provide smarter conversational human-machine interfaces such as chatbots.

Before we dive into the many benefits that AI-powered recruitment solutions offer, let’s take a quick look at some of the key use cases of the technology:

Analyze structured and unstructured data: AI enables HR teams to derive new insights at scale from structured and unstructured data without escalating costs and headcounts. These insights can be applied to solving business challenges such as aligning strategy, resource allocation, hiring, designing compensation strategies, and talent management.

Hire new talent: AI helps recruiters automate end-to-end hiring by optimizing resume parsing, screening, video interviewing, sourcing, and career site conversions. AI empowers recruiters to eliminate unconscious hiring biases and focus on skills and capabilities that’ll drive the organization’s competitive advantage. AI also offers scale – which becomes crucial for industries dealing with high-volume hiring. In addition to enabling organizations to find top talent, AI can also be leveraged to gain a qualitative understanding of candidates’ behavioral traits, temperament, and culture fit.

Optimize the employee experience: As employee expectations evolve, organizations need to deliver personalized employee experiences at scale to foster performance and retention. AI helps HR teams design bespoke employee experiences by tapping into key touchpoints to surface valuable insights on how employees interact with their workplace. With more technology in the workplace, organizations are sitting on a gold mine of data that can be channeled through AI solutions to deliver delightful experiences in the workplace (physical or virtual).

Support data-driven decision-making: The transformation in the way work has brought about unique challenges for business leaders. What worked in the past may no longer work for organizations in the current context. That’s where AI promises to be a valuable ally for talent acquisition leaders. Its ability to scope out different scenarios and predict the best course of action can help organizational leaders make decisions rooted in data rather than relying on “gut feel.” AI also enables organizations to perform real-time analysis, help stakeholders gain deeper insights into specific areas, and design solutions to address gaps or challenges.

Optimal resource allocation: During times of economic volatility, cost-optimization or rationalization is a top-of-mind priority for business leaders. Interestingly, high-performing organizations are more immune to external vulnerabilities because they approach cost rationalization as an everyday business practice, rather than waiting until they have no choice. With AI, talent acquisition teams can become more efficient with funding and resource allocation without compromising on talent, productivity, or business profitability. Cost savings realized this way could be reinvested in acquiring better skills, technologies and delivering positive experiences to hedge against potential volatilities and keep the growth engine running.

Top 6 Use-Cases of AI in Recruiting

Now that we’ve covered key use-cases, let’s understand how AI can help recruitment teams drive better business outcomes:

Recruitment Marketing

The process of ‘attracting’ the right talent begins long before a candidate is approached with a profile. Recruitment marketing recognizes the reality that a strong employer brand can play a significant role in attracting top talent. A well-thought-through employer branding strategy identifies the triggers and levers that appeal to their desired talent groups.

AI can help recruiters execute a solid employer marketing strategy by segmenting candidates and guiding them through the recruitment funnel. AI also enables recruiters to optimize key candidate touchpoints such as the career site, social media, branded content, and website chatbots.

Candidate Engagement

AI enables recruitment teams to automate candidate engagement across channels such as text messages, social media, and email with personalized messages. Additionally, AI-powered chatbots also provide candidates with answers to some of the most commonly asked questions. Being self-learning bots, organizations can also deploy these bots to provide feedback as candidates progress through various hiring stages. According to research, 75% of recruiters do not provide any feedback to unsuccessful candidates. This often leads to a bad candidate experience and closes the door to future engagement.

Talent Assessment and Video Interviews

HR teams can tap into the promise of AI to automate scheduling and assessment on smart platforms to make more objective hiring decisions. Underlying technologies such as machine learning analyze candidate responses to assign scores related to candidates’ attributes or predicted behaviors/results. AI is now also being deployed in video interviewing software to surface behavioral insights from candidate interactions.    

AI for Employee Onboarding

Research suggests that providing a smooth onboarding experience can improve employee retention by up to 82%. Unfortunately, only 12% of employees believe that their organization does a good job with onboarding. At a time when work is predominantly virtual, organizations need to deliver an exceptional onboarding experience to new hires. Here’s where AI can do most of the heavy lifting. By automating routine and repetitive tasks, AI can help HR teams improve their onboarding experience for new hires.

For instance, computer vision allows onboarding software to decipher and store employee information from documents such as ID cards, resumes, diplomas and certificates, and permits.

Additionally, AI-powered chatbots also help new hires ease into their roles by offering organizational knowledge and information through an interactive interface. Employees can ask the chatbot questions around leave and absence policies, remote-work policies, and their role to get instant responses, minimizing communication with HR without sacrificing engagement.

Unlike human support, AI is available 24x7 to guide employees through the onboarding process. Many onboarding solutions also have gamified content delivery with AI to enable organizations to onboard employees faster while improving the new hire experience.

AI for Compensation and Benefits

Deploying AI to make better compensation and benefits decisions can help organizations hire and retain top talent. AI’s analytical prowess enables HR teams to benchmark compensation, identify at-risk employees, and decide total rewards packages by leveraging data that would have previously remained untapped.

Using AI-driven compensation and benefits analysis can enable HR teams to improve on multiple metrics, including turnover rates, engagement, and offer acceptance rates. By replacing “gut instinct” with data-driven decision-making, HR can effectively reduce the cost of replacing high-potential employees.

A total rewards strategy fueled by AI also helps HR build competitive rewards and benefits strategies. HR teams can use data-driven recommendations to allocate resources optimally that foster a culture of loyalty and performance.

Furthermore, AI also automates a key influencer of employee engagement – benefits communication. Automated benefits communication delivers a more personalized experience to employees while maximizing the ROI on benefits management.

Navigating the Pitfalls of AI in Recruitment

While AI has come a long way, it is still far from perfect. It requires careful deployment along with the right kind of data to ensure accuracy and relevancy. Although the AI ecosystem is on the cusp of maturity, there are still a few kinks that need to be smoothed out. Here are some of the most common pitfalls you should watch out for when investing in AI-enabled recruiting solutions:

  • AI Bias:  Data-driven HR aims to weed out human bias that could creep up during crucial interactions with candidates or employees. In an ideal world, AI algorithms would be free of inherent biases; however, unfortunately, AI systems are trained on real-world data. This means, if there exist patterns of biases in training datasets, the AI algorithm will inevitably ingest those biases and project them. While selecting AI recruitment software, we recommend going with vendors who have deep expertise in the field and access to large training datasets relevant to your organization.
  • Measuring Success: AI deployment is unlike any other digital transformation initiative you’ve undertaken in the past. Your AI implementation strategy's outcomes in the HR function will look very different from other technology roll-outs you’ve undertaken. Work with your vendor to define your AI deployment initiative's success. The outcomes must tie into your business goals and incorporate benchmarks that could be unique to your organization or industry.

We recommend using data visualization and dashboarding solutions to define and track success factors.

  • Skills: AI solutions may require specific skill sets to ensure successful deployment. For complex, enterprise-wide deployment initiatives, you’ll need in-house or hired data science professionals to ensure that the software is tapping into the right data sources. The predictions and recommendations are in line with your key business objectives. Not having an in-house data science team is not a deal-breaker, though; you can choose plug-and-play solutions to simplify your deployment journey.
  • Employee Training: Recruitment software, or most enterprise software for that matter, is easy-to-use with straightforward interfaces. AI software can get a little tricky, though. Work with your vendor to understand how you can make the most out of your AI recruitment tech investment. The vendor might provide you with functional experts to coach your line managers and supervisors on optimally utilizing the software.
  • Data Privacy and Security: Before zeroing on a solution, you need to ensure compliance with the existing data privacy laws and security best practices relevant to your business. Over the past few years, data privacy's regulatory landscape has become more stringent with massive commercial repercussions for violations. As a technology primarily reliant on data, including employees’ personal information, compliance compatibility is a must. Additionally, you also need to do some due diligence on the security capabilities of your shortlisted solutions. Most vendors are happy to share information on the security standards their solutions are designed to meet.

7 Questions You Need to Ask Your Technology Partner

As a software buyer, you must go prepared for demos to identify a potential fit. A big part of that process is framing the right questions for the vendor. Here are a few questions you need to ask your AI vendor to gauge compatibility:

1.      Do you have deep experience in industrial-organizational psychology? (this is key to vetting for bias and flawed statistical approaches to AI training)

2.      How do your users interact with the software?

3.      How is your dataset trained? What data sources do you use? Will you be able to customize the solution for our use cases?

4.      How accurate are your predictive models? (error percent)

5.      What company sizes do you usually support?

6.      Do you share your security audit reports with customers?

7.      Do you offer 24x7 support?

How is AI Transforming Recruitment?

AI is helping recruitment teams reveal new insights from organizational and employee data to drive process improvements, cost-savings, and productivity. AI helps hiring teams solve critical business problems by providing analytical decision support and optimize recruiting spend. It also enables recruiters to automate routine tasks and focus on more high-value tasks that drive the competitive advantage of the organization.


An ideal AI recruitment solution will empower managers, supervisors, teams and individuals to make better decisions for themselves and work smarter. It augments your organizations’ existing skill sets to deliver better business results.

As we get closer to unlocking the true potential of man-machine collaboration, AI is no longer optional for recruiting teams looking to transform their talent acquisition practices and skillsets to thrive in the new world of work.

Here’s to your AI deployment success in 2021 and beyond!