With unemployment in the information sector hovering around four percent today, the hiring outlook for employers might appear bright at first: Unemployment among government workers (1.9%), by comparison, is far lower.

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But if you dig a little deeper into demand for today's hottest tech specialties, the shadows start lengthening. As many as 1.5 million new cybersecurity jobs are expected to be created this year alone, for example — and this is a specialty where unemployment recently touched 0 percent.

With top candidates exiting the job market in as few as 10 days, companies are turning to new tech tools to expedite and enhance their hiring processes. Where's the impact greatest — and what are the benefits, as well as the risks? We recently surveyed over 1,200 managers and employees to get insights.

Two high-level takeaways:

Let's unpack these takeaways in greater detail to see how companies can strategically leverage tech investment to get the most value out of their most valuable asset: their people.

tech-enhanced screening: benefits and risks

respondents who agree that online skills assessments are the most effective tech-driven screening tool

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Based on the results of our study, digital screening tools that enable skills testing are not only the most widely utilized at companies today, but also the most effective. Well over half (63%) of managers across industries report that their companies are currently using this technology. And perhaps not surprisingly, the employers most likely to have these tools in place today are in sectors like manufacturing, IT and finance and accounting — that is, sectors where on-the-job success depends on having "hard" skills and knowledge that can be objectively demonstrated and readily tested for.

What’s the value for businesses that adopt these screening technologies? For starters, they’re a kind of validation mechanism, confirming that candidates actually possess the skills they’ve listed on their resumes. What’s more, they facilitate a relatively "hands-off" process for screening candidates in advance of scheduling interviews, which means hiring managers and HR leaders can spend a lot less time digging through piles of resumes. And when you narrow the applicant pool to only the most qualified candidates, the interview process should move faster, too.

impact of online skills assessments on the candidate pool

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But what about potential risks? Perhaps the most significant danger of these screening tools is that they can lengthen the hiring process, thereby increasing the likelihood that you'll lose out on today's most in-demand talent — before the interview phase even begins. As things stand, companies that redirect people to their career sites from job boards see as many as 60 to 70 percent of candidates drop off without completing applications. Add in a complex screening protocol and that number is sure to rise.

Fortunately, companies may be able to guard against that by factoring in the size of the applicant pool and adjusting their screening processes accordingly. For example, given a smaller applicant pools, it probably makes sense to use skills assessments later on (perhaps even after the interview process has begun). In this case, HR managers should administer the test after speaking with candidates during the screening process. Candidates who have been made excited about a role after a conversation are much more likely to complete a skills test than those asked to complete one during a digital-only application process.

When you know the applicant pool is much larger, on the other hand, it’s usually safe to conduct skills assessments and screenings early on in the process.

video interviews: using tech to complement the human touch

After digital skills assessments, managers cited video interviews as the second-most-effective tech-enabled hiring practice at their companies today. This makes sense for a lot of reasons.

Let's start with the psychology. According to a much-cited University of Pennsylvania study, as much as 70 percent of all communication comes down to body language, while another 23 percent hinges on tone and inflection.

respondents who agree that video is the most effective tech-driven screening tool

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Seen in that context, video interviews are a great way to use tech to build human connections, and to get a feel for candidates' personalities and culture fit. In Randstad's survey, managers credited in-person meetings with revealing if candidates have done their homework to research and understand the organization — and there's no reason this kind of information couldn’t be drawn out from a video interview, too.

What’s more, our research suggests that video interviews are yielding particular value for employers in the IT space. Out of all industries in Randstad’s survey, IT managers were the most likely to rate video interviews as “the most effective technology-driven interview and candidate screening approach,” with 52 percent agreeing. That’s an encouraging sign that IT employers today are not only experimenting with the latest recruiting and hiring tools, but seeing real value from them as well.

However, one of the key takeaways from Randstad's survey is that different generations respond in different ways to technology's expanded role in the workplace, and employers will be wise to bear this in mind. For example, nearly half of baby boomers (46%) say that they conduct job hunts exclusively through in-person interactions — so if you’re trying to attract candidates from that cohort, digital communication channels may not deliver the results you want. Of Gen Z candidates, on the other hand, nearly one-fourth (23%) say that job hunting for them is an entirely digital process, without any in-person interaction at all.

Insights like these must be woven into talent acquisition strategies in order to ensure maximum ROI on any future tech investment. And for most companies, it will likely come down to a question of what balance, between digital and in-person touchpoints, yields the best results.

AI in the hiring process: still maturing

There's been a lot of excitement around AI's potential to disrupt, enhance and transform talent acquisition processes. And of course, few areas are more critical to  candidate outcomes than highly effective hiring and screening processes.

At the same time, Gartner has called AI "almost the definition of hype" — so it should come as no surprise that Randstad's study found a significant gulf between hopes for AI, and the realities on the ground.

What's the current state of AI in the hiring process?

In Randstad's study, less than half of all managers said that AI-powered technologies are an "effective technology-driven interview and candidate screening approach." What's more, still fewer employees have actually encountered these technologies in the course of the interview process.

That's not to say that AI won't have a significant impact on talent-acquisition processes in the future. But widespread adoption isn't right around the corner.

key takeaways

With top candidates on the job market getting snapped up faster than ever before, companies are turning to new tech tools to expedite and enhance their hiring processes. And for many, interviewing and screening are two areas where they're focusing investment — and, better yet, seeing clear benefits. To continue to be successful, however, these companies will be wise to carefully evaluate the risks and rewards involved in adding layers of complexity to the hiring process.

AI adoption, on the other hand, remains partial, with mixed results on the ground and limited first-hand experience among candidates. While this may well change in the coming years, forward-thinking companies will realize the most benefit by taking a balanced approach. And that means evaluating the pros and cons of potential tech investments through the eyes of their people — their most important asset.

You can see the key findings of our survey here. And to learn more about our high-tech, high-touch approach at Randstad Technologies, including how our talent can move your business forward, contact us today.