The Applicant Blindspot
New research from Harvard Business School explores the mismatch between job seekers and companies that are hiring, and identifies a surprising culprit: hiring software.
The research explores the possibility that recruiting and screening software, often powered by artificial intelligence, prioritizes the perfect candidate and fails to identify the promising ones. It’s a classic case of credentials versus capabilities, they write. The outcome is that companies, banks among them, overlook the resumes of applicants who would be a good fit with training, including groups that don’t screen well. The software, in other words, misses out on the potential benefits of a loyal and motivated workforce.
Researchers surveyed more than 8,000 workers across the globe whom they classified as being “hidden” or overlooked by companies, along with more than 2,250 executives across the U.S., the U.K. and Germany. More than 90% of employers surveyed use either a recruiting management or marketing system in addition to an applicant tracking system to market open positions, identify and create potential talent pools, and automate tasks like candidate scoring or interview scheduling. Those systems figure prominently in the initial filtering of applicants, using proxies and elimination criteria to quickly assess candidates.
“As a result, they exclude from consideration viable candidates whose resumes do not match the criteria but who could perform at a high level with training,” the researchers wrote. “A large majority (88%) of employers agree, telling us that qualified, high-skills candidates are vetted out of the process because they do not match the exact criteria established by the job description.”
To reverse it, companies need to engage with the software itself, among other adjustments. The researchers recommend switching the hiring software from a “negative” filter — excluding a promising candidate who doesn’t have a college degree or has an employment gap — to “affirmative” logic that matches an applicant’s specific skills and experiences with an open position’s core requirements.
While labor tightening and shortages have made headlines this year, the researchers believe this hiring disconnect has persisted for more than a decade. It will take time for companies to rectify and reverse it. But with an estimated 27 million hidden workers in the United States, the impact of companies finding those workers could be huge.
• Kiah Lau Haslett, managing editor of Bank Director
