As apps and SaaS offer greater service in the recruiting arena, is it time for humans to get out of the game?
A recent study from the National Bureau of Economic Research (NBER) suggests algorithms are better equipped to make hiring decisions that boost company retention rates. The study involved a meta-analysis of 300,000 employment records from 15 different companies. About a third of the employees hired were assessed and hired based on online personality and skills testing.
Some fine points of the study include:
• The study evaluated positions that are generally considered repetitive or lower skill jobs, such as employment in a call center, or grading standardized tests.
• The retention rate for those chosen by computer was 15 percent higher than hires made by humans.
• Hires made by humans were not significantly more or less productive than those made by computer.
One of the study authors, Dr. Mitchell Hoffman, notes, “It definitely suggests that more decision making powers should be given to the machine relative to the humans.”
Have recruiters and hiring managers become outdated?
Mind and machine—the best hiring combination
Algorithms used throughout the recruiting cycle are worth the cost. #ProjectNova, the ATS solution from OrangeHRM, uses Watson technology to offer fine-grained candidate analysis and comparison. From cultivating social media for candidate information, to prompting specific interview questions, Project Nova is a digital recruiting assistant.
But does a sophisticated ATS module dismiss the human factor? The short answer is “no.”
Just as HR software created time and data efficiencies for HR, Project Nova and other ATS tools perform tasks that streamline and improve the recruiting process. From populating niche job boards, to cultivating better data, Project Nova and similar tools give managers the edge in hiring the right talent for the job.
Despite such advantages, these products remain tools, not decision makers.
The NBER study evaluated lower level, high-turnover positions. While software could be useful in these instances, it is not likely algorithms will become stand-alone hiring tools for recruiting the skilled, high-level talent essential for keeping your company competitive.
Retention rates are one piece of a more complex hiring puzzle. Homogeneous hiring decisions could be successful for a certain type of business, but less helpful for a dynamic company dependent on its creative and development teams for getting products and services to market.
Using improved social and recruiting technology tools means HR personnel can spend more time on strategy, and fine-tuning retention policies. The best hiring combination utilizes both mind—and machine.