What Is an Applicant Tracking System (ATS) and How It Works

An applicant tracking system is specialized software designed to automate and streamline the recruitment process. But what is an ATS beyond this basic definition? Essentially, an applicant tracking system serves as a centralized database and management tool that helps organizations collect, organize, screen, and track job applications throughout the entire hiring journey.

The primary purpose of an applicant tracking system is to simplify the recruitment workflow, allowing hiring teams to efficiently process large volumes of applications while identifying the most qualified candidates. For many organizations dealing with hundreds or thousands of applicants per position, an applicant tracking system has become an indispensable part of their recruitment strategy.

When candidates ask "what is an ATS?" they're usually inquiring about the software that will be processing their job application. Understanding that an applicant tracking system acts as a digital gatekeeper can help job seekers better prepare their application materials.

Now that we've addressed what is an applicant tracking system, let's explore how these systems function. The typical applicant tracking system workflow includes several key steps:

1. Job Posting Distribution: The applicant tracking system allows recruiters to create job listings and automatically distribute them across multiple job boards, career sites, and social media platforms.
2. Application Collection: As candidates apply, the applicant tracking system collects and stores their resumes, cover letters, and application forms in a centralized database.
3. Resume Parsing: The applicant tracking system uses sophisticated algorithms to extract relevant information from resumes, including education, work experience, skills, and contact details.
4. Keyword Matching: One of the most critical functions of an applicant tracking system is comparing resumes against job descriptions to identify candidates with matching qualifications. The system scans for specific keywords, phrases, and terms related to the position.
5. Candidate Ranking: Based on keyword matches and other criteria, the applicant tracking system ranks applicants according to their relevance and suitability for the role.
6. Candidate Screening: Many applicant tracking system platforms include screening questions or assessments that automatically filter out candidates who don't meet basic requirements.
7. Application Tracking: As candidates move through different stages of the hiring process, the applicant tracking system maintains a record of their status, communications, and evaluations.
8. Interview Scheduling: Advanced applicant tracking system software often includes tools for coordinating and scheduling interviews between candidates and hiring teams.
9. Reporting and Analytics: Most systems provide insights into recruitment metrics, helping organizations optimize their hiring strategies and processes.

Understanding how an applicant tracking system works is crucial for both employers implementing these systems and job seekers crafting application materials designed to pass through them successfully.

Applicant tracking systems have become ubiquitous across various industries and organization sizes:

Large corporations with high-volume hiring needs were early adopters of applicant tracking system technology. These organizations typically receive thousands of applications for each open position, making manual review practically impossible.

As applicant tracking system free options and affordable subscription models have emerged, smaller businesses have increasingly adopted these tools to professionalize their recruitment processes and compete for top talent.

Staffing and recruitment firms heavily rely on applicant tracking system software to manage their client positions and candidate databases efficiently.

Public sector entities use applicant tracking systems to ensure compliance with complex hiring regulations while streamlining their recruitment processes.

Universities, colleges, and school districts implement applicant tracking system solutions to manage faculty and staff hiring.

Hospitals and healthcare networks use specialized applicant tracking system platforms to handle the unique requirements of medical staff recruitment.

With cloud-based solutions and scalable pricing models, applicant tracking system technology has become accessible to organizations of virtually any size and budget.

• Increased Efficiency: Applicant tracking systems dramatically reduce the time spent on administrative tasks, allowing recruiters to focus on strategic aspects of hiring.
• Cost Savings: By automating manual processes, organizations using an applicant tracking system typically see reduced cost-per-hire and time-to-fill metrics.
• Improved Candidate Quality: ATS recruiting software helps identify the most qualified candidates through consistent screening criteria and keyword matching.
• Enhanced Collaboration: Most applicant tracking system platforms facilitate better communication among hiring team members, enabling collaborative decision-making.
• Data-Driven Recruitment: The analytics capabilities of an applicant tracking system provide valuable insights that help optimize recruitment strategies.
• Compliance Management: Top ATS software includes features to help organizations maintain compliance with equal employment opportunity laws and other regulations.
• Better Candidate Experience: Many modern applicant tracking system solutions offer user-friendly interfaces and automated communications that keep candidates informed throughout the process.

While applicant tracking systems are primarily designed to benefit employers, they offer several advantages for job seekers as well.

• Streamlined Application Process: Well-designed applicant tracking system platforms provide a smoother, more intuitive application experience compared to traditional methods.
• Increased Visibility: When your resume is properly optimized for an applicant tracking system, it increases the likelihood that your application will be seen by recruiters for relevant positions.
• Faster Response Times: Automated communications from applicant tracking system software keep candidates informed about their application status, reducing uncertainty during the job search.
• Fair Consideration: When implemented properly, an applicant tracking system can reduce human bias in the initial screening process by evaluating all candidates against the same objective criteria.
• Job Recommendations: Many applicant tracking system platforms include features that suggest additional relevant positions to candidates based on their qualifications and experience.
• Application Tracking: Candidates can often track their application status in real-time through the applicant tracking system portal, providing greater transparency in the hiring process.
• Skills Gap Identification: Some advanced applicant tracking system solutions provide feedback to candidates about skill gaps, helping them understand where they might need additional qualifications for desired roles.

When evaluating what ATS software is best for your organization, it's important to understand the features that differentiate the best ATS software options from basic solutions. Here are the essential features to look for:

• Comprehensive Job Distribution – Top ATS software allows recruiters to post job openings to multiple platforms simultaneously, including job boards, social media, and company career sites.
• Advanced Resume Parsing – The best applicant tracking system platforms use sophisticated algorithms to accurately extract and categorize information from resumes in various formats.
• Customizable Workflows – ATS recruiting software should allow organizations to create customized hiring workflows that reflect their unique recruitment processes.
• Automated Screening Questions – Many top ATS software options include customizable screening questions to automatically filter candidates based on specific criteria.
• Interview Scheduling Tools – Built-in scheduling functionality streamlines the coordination of interviews between candidates and hiring team members.
• Collaborative Evaluation – The best ATS software facilitates collaboration among hiring team members, allowing them to share feedback and evaluations.
• Mobile Accessibility – Modern applicant tracking system platforms offer mobile apps or responsive interfaces for recruiters and hiring managers on the go.
• Candidate Relationship Management – Advanced applicant tracking system software includes CRM features to nurture relationships with promising candidates over time.
• Reporting and Analytics – Comprehensive data visualization and reporting tools help organizations track key recruitment metrics and optimize their processes.
• Integration Capabilities – Top ATS software should integrate seamlessly with other HR systems, background check providers, assessment tools, and other recruitment technologies.
• Compliance Management – Features that help organizations maintain compliance with employment laws and regulations are essential in modern applicant tracking system platforms.

The cost of implementing an applicant tracking system varies widely depending on several factors:

Some providers offer applicant tracking system free versions with basic functionality, suitable for small businesses with limited hiring needs. These free options typically have restrictions on the number of job postings or users.

Most applicant tracking system software is available through monthly or annual subscription plans. Pricing is often based on:

• Number of users
• Number of active job postings
• Number of applications processed
• Additional features and modules

Some ATS recruiting software providers charge on a per-hire basis, which can be advantageous for organizations with sporadic hiring needs.

Large organizations typically invest in comprehensive enterprise applicant tracking system platforms with custom pricing based on their specific requirements and implementation needs.

When evaluating applicant tracking system costs, organizations should consider not only the immediate subscription fees but also implementation expenses, training costs, and potential integration requirements.

Choosing the right applicant tracking system requires careful consideration of several factors:

Different applicant tracking system solutions are designed for different organizational scales. A small business with occasional hiring needs will have very different requirements than a large enterprise with constant recruitment activity.

Some industries have unique recruiting challenges and compliance requirements that may necessitate specialized applicant tracking system features.

Both recruiter experience and candidate experience should be considered when evaluating ATS recruiting software. An intuitive interface reduces training time and increases adoption.

The best ATS software for your organization should integrate smoothly with your existing HR technology stack and other business systems.

As your organization grows, your applicant tracking system should be able to scale accordingly without requiring a complete platform change.

Consider the level of customer support, training resources, and implementation assistance provided by the applicant tracking system vendor.

Calculate the potential return on investment by considering time savings, reduced cost-per-hire, and improved quality of hires.

By thoroughly evaluating these factors against your specific recruitment needs, you can select the top ATS software solution that best supports your organization's hiring goals.

The applicant tracking system landscape continues to evolve with emerging technologies and changing recruitment practices:

• AI and Machine Learning – Advanced applicant tracking system platforms are incorporating artificial intelligence and machine learning to improve candidate matching and predictive analytics.
• Enhanced Candidate Experience – Next-generation applicant tracking system solutions focus more heavily on the candidate experience, with more intuitive interfaces and transparent application processes.
• Diversity and Inclusion Tools – Many applicant tracking system vendors are developing features specifically designed to reduce bias and promote diverse hiring practices.
• Remote Hiring Support – In response to the rise of remote work, applicant tracking system technology is evolving to better support distributed teams and virtual recruitment processes.
• Data Security and Privacy – As privacy regulations become stricter, applicant tracking system providers are enhancing their security features and compliance capabilities.

Organizations should consider not only what an applicant tracking system offers today but how it will evolve to meet future recruitment challenges.