Benefits of Recruiting Software & Applicant Tracking Systems
Hiring is a crucial aspect of growing your business. However, as your company increases its hiring needs, recruiters can easily become overwhelmed if they don’t have a system in place to help keep them organized. Lack of organization can result in a poor interview experience for candidates, as it results in long periods of waiting for a response, or in getting lost somewhere in the interview pipeline. According to LinkedIn’s Global Recruiting Trends Report 2017, which surveyed 4,000 recruiting professionals around the world, 56% of respondents expected their hiring volume to increase in 2016. Meanwhile, only 32 percent of hiring managers expected the size of their recruiting teams to increase over the same time period. It’s no surprise that many recruiters rely on recruiting software to streamline the hiring process, so that they can deliver on increasing hiring needs.
In this guide, we'll compare the benefits of various recruiting and applicant tracking software systems, and assess whether or not it is worth the investment for your particular needs. Even if you’re already using HR software that includes some recruiting capabilities, this guide can help you determine if there may be a specialized recruiting system that is better suited to your needs.
How much does recruiting software cost?
As with many software systems, the price can vary widely. Unfortunately, it’s common practice for recruiting software / ATS to not publish their prices. This means that the price is often negotiable, so when you reach out to recruiting software vendor for a quote, it’s highly recommended to negotiate the terms (either through a lower rate, or a reduced/waived setup fee). If you simply accept the first quote that the sales rep provides you, you’re most likely not getting the best offer possible.
Different products have different pricing structures. For example, Greenhouse charges based on the number of employees you have. Other systems will charge based on the number of hires or the number of job postings. Newton is one of few companies that publishes their prices, and they charge a flat rate of $399/month.
Typically, small to medium-sized businesses should expect to pay a few thousand dollars per year for their recruiting software, and the price will go up as your hiring needs increase, and as your company grows.
How does recruiting software work?
Recruiting software is designed to help companies fill job openings more efficiently. One major function that this software serves is to help recruiters source qualified candidates through job boards and other platforms. Recruiting software may also help recruiters aggregate and filter through a steady stream of applications from disparate sources, in order to decide which candidates should advance to the next round. Most systems also include applicant tracking capabilities, in order to provide recruiters and hiring managers with a central place to track and organize applicants and their current status.
Recruiting and applicant tracking systems typically provide one or several of the following capabilities:
- Seamlessly list job postings across several platforms
- Narrow down the candidate pool by filtering for keywords in resume’s
- Facilitate and encourage better employee referral programs
- Create a better experience for hiring managers and applicants with automated responses and better branding
- Applicant tracking: deliver analytics about candidates, help hiring managers visualize where candidates are in the process, and gather interview feedback from employees
We’ll walk through these capabilities in more detail, and explain how they can help streamline your hiring processes.
Publicize job openings, and filter through applications
The first step in attracting high-quality applicants is to make sure that qualified candidates see your job postings. Therefore, before you can devote attention to other aspects of the hiring process, it’s important to find a way to get your job postings in front of the right eyes, with as little manual effort as possible. Recruiting is a powerful tool that helps automate the process of posting job openings across hundreds of platforms at a time.
The more exposure your job openings can get, the better. Companies like Jobvite specialize in helping you submit job openings across hundreds of job boards at a time, giving you more time to spend on other tasks, like interviewing candidates.
With the increased flow of applications, recruiters may be left to sift through more resumes and cover letters. To help reduce this burden, many recruiting software systems will allow you to add pre-screening questions to quickly weed out applicants that aren’t suitable for the position. These systems typically also help recruiters filter through resumes for keywords, to determine which applicants should continue through the process, and which should automatically be disqualified. This helps automatically narrow down the vast array of applications that come through for any job listing, so that you’ll only need to sift through a more manageable pool of quality candidates. Another great aspect of using recruiting software is that it aggregates all of your applicant data and makes it accessible, so you can quickly search through your entire applicant pool for any desired skill or keyword you need.
Attract higher-quality candidates with employee referrals
Employee referrals can often be the best way to attract qualified applicants for your job postings, and having a strong employee referral program should be part of any serious recruiting strategy. To help streamline the referral process, some recruiting systems like Greenhouse and Jobvite provide a personalized link (with tracking for sourcing/attribution purposes) that your current employees can easily share across their social networks, like Facebook and LinkedIn.
Employee referrals tend to not only be qualified applicants, but they also tend to stay at their company longer. According to a 2012 Jobvite study, 46% of candidates who were referred to the company by an employee tend to stay on with a company for 3 years or more, whereas only 14 percent of candidates sourced from job boards stayed for 3+ years.
Because these systems typically provide source tracking for links shared on social media sites, HR departments can incentivize employees to share job openings with their professional and social networks (e.g., through referral bonuses), while removing much of the manual labor involved with setting up an employee referral program within the company.
Create a positive experience for applicants
Recruiting software can also help improve the interview experience for candidates, and give them a positive impression of your company. It’s easy to forget that selling the candidate on your company is an important part of the interview process, and that it’s important that all candidates, regardless if they’re hired or not, have a positive interview experience. If a candidate has a bad experience, they could leave a negative review on Glassdoor that could then dissuade future desirable candidates from applying for other positions. Software aims to help improve the experience for your applicants in two main ways:
- Creating an attractive, mobile-friendly careers page that attracts candidates, and streamlines the application process
- Automating communication with applicants throughout each stage of the application cycle, from initial submission of resume/cover letter, to the final decision
Recruiting software often includes the option to easily create branded careers sites without requiring any technical experience. This enables recruiters to iterate faster whenever new jobs need to get added, or job descriptions need to be updated, as they won’t need to wait on the development team to update their internal careers page. A well-designed careers site that makes it easy to quickly apply can also help decrease the likelihood that applicants will get frustrated and give up halfway through the process. Some software systems also enable recruiters to experiment and create various types of microsites to successfully target specific locations or recruiting events/job fairs.
With the large number of applications submitted for every job opening, it’s impossible for recruiters to personally respond to everyone. However, recruiting software can help complete the small courtesy of communicating at least once with every person who applies to your company. After a candidate has submitted their application, you can set up the software to automatically send a prewritten response that thank them for their time, and inform them that they will be contacted if they have been selected to proceed to the next step of the application process.
Track candidates through the hiring lifecycle
Having access to a central recruiting platform is particularly useful for larger companies, or companies that are hiring rapidly across many different departments. With a central applicant tracking system, recruiters and managers can gain more clarity into the status of each candidate’s application, and access relevant information about candidates they’re interested in. They can also schedule interviews and discuss each candidate, instead of piecing together information across multiple sources like email or chat.
These systems typically integrate with Google or Outlook calendars, so that employees across different departments can communicate clearly with recruiters about their availability for interviews. In systems like Greenhouse, sensitive information (e.g., pertaining to compensation) can be flagged and made visible only to certain levels of employees. This functionality ensures that all levels of employees can access the system, but will only have access to the information that they need in order to fulfill their roles within the hiring process.
Applicant tracking systems also provide analytics about how candidates were sourced (applied directly, referred internally, job fair, etc.), so that you can understand which types of candidates tend to be more successful. This can help recruiters make data-driven decisions in order to source candidates more effectively.
Is recruiting software worth it for your business?
It’s clear that large enterprises with many job openings can benefit greatly from using recruiting and applicant tracking software to streamline their process -- without software, the hiring process would be impossible to manage. However, recruiting software is becoming an increasingly attractive option for smaller businesses as well, especially for companies that are experiencing rapid growth. And, as more recruiting solutions enter the market, pricing will become even more competitive and affordable for companies of all sizes.
If you’re recruiting for a small business or startup with just a handful of openings, you may find it more economical easier to recruit new hires by using simple spreadsheets. However, as your company’s recruiting efforts grow, spreadsheets will become unwieldy, and investing in the right recruiting and applicant-tracking software can be an excellent investment. Though recruiting software can cost thousands of dollars a month, it can pay dividends in attracting the right candidates to your company. Not only will it save your sourcers and recruiters time, but it will also provide candidates with a better interview experience, and ultimately help you fill your job req more quickly.