Why do companies use an applicant tracking system (ATS)?

Question: 

Why do companies use an ATS?

Answer: 

Because without it, they’d have to sort through hundreds, possibly thousands, of resumes by hand.

Explanation: 

One of the most common questions I get is how to “beat” applicant tracking systems. That’s a really big topic requiring a lot of background explanation. So let’s start at the beginning. Why do companies even use applicant tracking systems (ATS) at all?

When job searching moved mainly online and as our society became more mobile, companies started getting inundated with large quantities of applicants. Back in the olden days (i.e., before approximately 2001), people applied via mail or in person and typically only for jobs in their geographic region. This meant the applicant pool was much smaller. It also meant the pool tended to be higher quality because applicants had to pay for a stamp or spend their time traveling to the company where they were applying. This created a disincentive to send your resume out to any and every job that you had even the remotest chance at landing and instead focus on jobs for which you were well-qualified.

Now that people can apply for a job in just a few clicks (although just because you can doesn’t mean you should), job seekers tend to submit their applications to a higher number of open positions. Additionally, because of remote work and the willingness of applicants to relocate, the applicant pool is no longer limited to a geographic area. All of this means that when companies post a job online, especially on a job board such as Indeed or LinkedIn, they are often inundated with hundreds, sometimes thousands, of applicants.

Enter the ATS, a screening tool that can, when it’s performing as it should, weed out unqualified applicants and rank remaining applicants from most to least qualified. Additionally, an ATS is an organization tool, sorting resumes into folders, allowing recruiters and hiring managers to track where specific applicants are in the process. Many ATSs can also send out automated emails when a candidate is rejected or moved to the next stage.

The goal is to spend less time filtering out candidates who clearly aren’t qualified so that they can spend more time reviewing and interviewing the promising candidates. 

Now, the caveat here is that everything I’ve said so far assumes the ATS fulfills its intended purpose. It doesn’t always. Sometimes it rejects qualified candidates and, more often, it lets through unqualified ones. I often speak with hiring managers frustrated that the candidates who got through weren’t at all what they were looking for. And I often hear from job seekers saying they got an automated rejection email less than 24 hours after submitting an application, even though they’d been doing exactly the same kind of job for the last 6 years. So there’s definitely a disconnect between what an ATS is supposed to do and what it actually does. But dealing with those issues is a topic for another time. For now, companies use an ATS, imperfect though it is, because they don’t see a more efficient way to sort through the huge stack of resumes on their virtual desks.