Human Intelligence: Recruiting's Hot New Trend

AI is a Tool, Not a Solution

Like much of the business world, AI buzz has dominated the staffing and recruiting industry and AI “solutions” have proliferated. Unfortunately, the marketing hype around recruiting AI has outstripped the results. In this article, we contend that human intelligence—not artificial intelligence—remains the most important component of an effective recruiting strategy.

Before we make that argument, allow us one important disclaimer: we believe AI will have a powerful and lasting impact on how people recruit. This article is not intended to question the value of AI—so please don’t flood us with angry comments. Rather, our critique is that AI is being promoted and seen as a solution when, in fact, it’s simply a formidable tool in the recruiter’s toolbox.?

AI-Washing Undervalues Skilled Recruiters?

So-called “AI-washing”—the practice of overstating the role AI plays in a product or service—is rampant in our industry. A quick Google search reveals companies’ grandiose claims of proprietary AI software, guaranteed application results, or seamless resume screening. But in practice, many of these recruiting AI claims are mere window dressing.?

For example, I spoke recently with a competitor employee—(they shall remain unnamed, but their firm proudly touts its AI-powered recruiting model)—only to learn their “AI-powered” model is functionally the same CRM used by nearly every staffing and recruiting company in the country. After digging, I learned another competitor’s “AI-driven approach” was mostly GenAI tools embedded in commonly used enterprise software. I could go on. I’m left believing the primary things “AI” about most firms are industry-standard software or—more importantly—clever marketing.

AI-washing is unequivocally a deceptive practice. (In finance, where I’ve spent a decade, there are criminal investigations regarding AI-washing.) But the deeper problem with AI-washing is that it causes businesses to undervalue the contributions of skilled recruiters. This is why, as companies automate business processes previously performed by skilled professionals, they experience a slew of unintended and disappointing consequences.

Unqualified Applicants Waste Time and Money?

The unintended consequences began with too much of a good thing: applications. Because of AI’s ability to target broad swaths of potential jobseekers, platforms claimed they could increase the number of applicants a company would receive per posting. It sounded plausible. So, how good were these AI-targeted ads?

They’ve been very good indeed at increasing applicant volume. Unfortunately, they’ve been less effective at increasing qualified applicant volume—which is really the whole point. Broadening the search scope and simplifying the application process naturally encouraged more applicants, but it did little to effectively screen out unqualified applicants and lookie-loos.

In a recent TalentZ?k survey, more than 80% of respondents said they’d been targeted by LinkedIn, ZipRecruiter, GlassDoor or other platforms to apply to jobs for which they were “wildly mis-qualified.” (Sometimes they were over-qualified, sometimes under-qualified, and sometimes just confusingly qualified. Personally, I once received an ad to apply for a job as a graphic designer, despite never having worked in the industry or been educated in the field—though I have an abiding passion for graphic design. I’m embarrassed to admit I thought about applying.)?

One of the tragedies of recruiting AI is how often it backfires as a cost-saving measure. For example, in a fruitless attempt to reduce costs by automating processes, one of our mid-sized clients invested significant money in its ATS and AI-driven partnerships. Its 6-figure investment did, indeed, improve applicant volume; but it did not improve screened applicant quality. In the end, the company hired back the two recruiters it recently laid off—plus an additional recruiter—to apply human intelligence to its now larger volume of AI-driven applications. The company’s attempt to automate and save money has not yet materially improved candidate quality; but it has led to a 50% increase in W2 recruiting costs.

AI-Powered ATS vs. AI-Powered Applicants

It’s ironic how often AI is touted as a solution to the unintended consequences of its last solution.

For example, as AI-driven applications spiked, companies turned to AI-powered applicant tracking systems (“ATSs”) to automatically screen a new flood of inbound applications. According to Business Insider, 97% of Fortune 500 companies now use AI-powered automated hiring systems to screen out candidates. AI arrived just in time to save them from AI!

It hasn’t quite worked out.

In practice, ATS algorithms screens out a material number of highly qualified candidates who fail to meet certain requirements. These include candidates who omit a desired keyword on their resume, have highly transferable experience in related but different industries, or have material but easily explained employment gaps. According to a recent ASA/Harris Poll, more than 70% of applicants feel their resumes effectively “disappear” upon submission. The result is that experienced and qualified candidates do not get interviews for reasons that are difficult to understand.

Even worse, highly-qualified candidates often find themselves ghosted or the recipient of an automatically generated form letter. Confused by their rejection, they rarely have an actual human they can call to explain the basis for the hiring decision.

It makes perfect sense that jobseekers are frustrated by these so-called “false negatives,” particularly in a tight job market. This may be why ZipRecruiter’s Job Seeker Confidence Index recently showed confidence reaching its lowest point in more than two years, with just 15% of jobseekers saying their hunt for a new opportunity is going well.

And that’s not even the whole story.

Even as well-qualified candidates are being excluded by AI, under-qualified candidates are getting better at gaming the AI-ecosystem for their own benefit. In some instances, they are using Gen AI to write cover letters, edit resumes, or take exams. In other cases, they are deliberately manipulating employers’ ATS, including through the now-common practice of “white fonting,” which involves including a large number of keywords in your resume in a font color that is hidden from human eyes but visible to the ATS algorithm.

The result for employers is that their ATS isn’t always selecting for the most qualified candidate, but rather, for the candidate that is best able to navigate an AI-powered ATS. In fact, some experts estimate that more than half of job seekers have now started using AI in their own job search. Just as jobseekers are understandably frustrated by false negatives, employers are increasingly annoyed by the “false positives” mucking up their recruiting process. (A somewhat troubling footnote is that a recent ASA survey shows that white, well-educated men are most likely to use AI as an application tool, resulting in continued bias in favor of this historically-favored demographic.)

In short, the recruiting industry is currently caught in the middle of an ever-escalating AI arms race. Employers increasingly use AI to parse an overwhelming number of applications; then job seekers use AI to bypass hurdles and apply in ever-greater numbers; then employers put up new time-consuming hurdles that require more time and money; then applicants use new methods to circumvent them, etc., ad nauseum.

We’ve all seen the 1983 classic War Games. The only outcome of this perpetual game of tic-tac-toe is mutually assured destruction.

The Legal Fallout

If there’s one thing AI was supposed to deliver—just one thing—it was the elimination of bias in the hiring process. Computers can’t be racist, sexist, ageist, homophobic, or otherwise bigoted. Right??

Ah, we were so na?ve.?

Because I’m an employment lawyer, I’ll refrain from digging too deep into this topic lest people overweight my opinion. But I encourage readers to investigate the legal risks (and likely future class actions) brewing as a result of over-reliance on AI-powered ATS. At this point, most major employment firms around the country have published detailed notices regarding the use of AI in the hiring process. Go read them.?

Perhaps more importantly, a recent Harris Poll found that 49% of active jobseekers believed AI Hiring Tools are more biased than human recruiters. (Just 18% felt they were less biased.) Regardless of whether AI systems have inherent bias, the mere perception of bias can undermine a company’s hiring process or reputation. The legal risk is real; proceed with caution.

AI is a Tool, Not a Solution

AI promised to be a solution to all that ails us. It would reduce recruiting costs, improve candidate quality, and mitigate legal risk. To date, it has struggled to achieve these things. But that doesn’t mean AI won’t still transform our industry.

When I began in staffing 25 years ago, Monster and CareerBuilder had just gone mainstream. I remember a headline at the time claiming this would be the end of the staffing and recruiting industry. Employers could now post open jobs directly to the Internet. Why would any company need a recruiter?

I know that you know where I’m going with this: the size of the staffing and recruiting industry has more than quadrupled since CareerBuilder was founded. Today, it’s worth hundreds of billions globally. Clearly, the Internet was not the end of the industry; it was almost the beginning.

That said, online job boards did transform how the industry conducts its business. What we learned from the late 90s and early aughts is that online job boards were not a “solution”; but they were a “tool.” And just like any tool, job boards were most impactful when they were deployed by people with skill and experience in the trade.

In this same way, AI will transform the staffing and recruiting industry. It is a powerful tool that, when used by intelligent human beings, will revolutionize how we do business. But I do not believe AI will ever be—on its own—a wholesale solution to talent acquisition and management.

?