Essential applicant tracking system buying information
Applicant tracking system (ATS) software allows organizations to formalize their recruiting processes and maintain a database of applicant information. Using an ATS, employers can store job applications and resumés, assess candidates against hiring requirements, and analyze recruiting data for important insights.
Recruiters and HR leaders are often the primary users of ATS software, but hiring managers can also use an ATS to evaluate candidates and schedule interviews. In smaller businesses that don’t have a dedicated recruiting role, the owner or CEO might use an ATS to post job openings.
Jenn Tardy1, an HR trainer and consultant specializing in diversity recruitment, says an ATS shares many features with recruiting software. However, she explains, “an ATS will better serve you with things like hiring compliance and tracking key metrics like time to hire, cost per hire, and diversity.”
Most applicant tracking systems on the market are priced on a per-month subscription basis. Costs for popular systems can range from as little as $180/month for a basic system used by a handful of users all the way to up to $2,800/month or more for an advanced platform used by hundreds of users.2
First-time ATS buyers need to consider their budget, hiring needs, and any integrations with the rest of their HR software stack when evaluating their options. Tardy advises business leaders and decision-makers to consult with stakeholders to determine the most important questions to bring to vendors. They should ask vendors questions such as:
What pain points in our candidate experience will your software address?
What recruiting tasks can be automated by your software?
What recruiting metrics will your software help us track and analyze?
Is your software catered more toward high-volume hiring or finding highly-qualified niche talent?
Tardy explains that consulting stakeholders upfront not only helps you get the best system for your business but also helps you get buy-in from the people who will actually be using the system.
"It's important to bring them along in the purchasing and implementation process," Tardy says. "You may think it's just a matter of buying some software, but it can be a lot more challenging than you expected. What you thought would only take you a few months can end up taking almost a year because of all the issues you have to solve. So it's important to get everyone on board from the start.”
What are the most reviewed applicant tracking systems?
Capterra Shortlist identifies the top applicant tracking systems based on a proprietary blend of user ratings and popularity, helping small businesses efficiently find the most effective ATS solution for their needs.3 Here are the five most reviewed products in our Capterra Shortlist for this category:
These rankings are determined by combining verified user ratings and publicly available web search popularity data:
Ratings score: Relative score of the software based on ratings given by users on Capterra, normalized for number and recency of reviews.
Popularity score: Relative popularity of software based on web search trends and products’ web presence.
What is an applicant tracking system?
An applicant tracking system, or ATS for short, is a type of recruiting software that helps businesses manage their recruiting pipeline and keep track of job applicants as they progress through the company’s hiring process.
Acting as the central hub for all of a company’s recruiting and hiring needs, applicant tracking systems allow users to post job openings, source job candidates, set up their online job application process, and store submitted resumes. Users can also schedule interviews, order background checks, or leverage analytics to identify pain points in their candidate experience.
Gartner views applicant tracking systems as a subsegment of the broader human capital management (HCM) software market, which had annual revenue of $22.4 billion with 11.7% year-over-year growth in 2022.4 Capterra covers 846 different ATS products, with 8,922 reviews added in the last year.5
ATS pricing
Most applicant tracking systems on the market are priced on a per-month subscription basis. Costs for popular systems can range from as little as $180/month for a basic system used by a handful of users all the way to up to $2,800/month or more for an advanced ATS platform used by hundreds of users.
Entry-level applicant tracking systems include the core functionality of candidate tracking, candidate profiles, and job posting.
An advanced product that’s priced higher typically includes additional features such as advanced reporting, automated candidate scoring, and customizable branding.
Tardy advises first-time buyers should be aware that:
Setup, customization, and integration are common upfront costs.
Maintenance and customer support are common recurring costs.
Training might be an additional cost. Vendors might offer general training, but you could end up being charged extra for more specialized training.
Pricing is often based on the number of users or employees you have, but can also depend on the number of job openings you post, or the number of applications you receive. To incentivize longer contracts, ATS vendors might offer a discount if you opt for an annual subscription instead of a monthly one.
“You need to ask up front how much it's going to cost you to add additional software users so you can estimate the long-term cost,” Tardy says.
Buyers can also save money by using a free ATS system or one with a free trial. There can be drawbacks to free software, however, like having to host and fix the system yourself (instead of getting assistance on this from a vendor).
For reference, 51% of the buyers looking for applicant tracking software that we spoke to in the past year are budgeting $5 to $10 per employee, per month.6
Features of ATS software rated by users
All ATS software include candidate tracking, candidate profiles, job posting features, and candidate sourcing, and most have a variety of common features such as application management, resume storage, and interview scheduling.
Core ATS features
Candidate tracking: Record interactions, notes, and developments with job candidates. 93% rate this feature as critical or highly important.
Candidate profiles: Track candidate information such as role, professional qualifications, experiences, skills, or other attributes. 91% rate this feature as critical or highly important.
Job posting: Post, track, and manage job openings on multiple channels. 87% rate this feature as critical or highly important.
Candidate sourcing: Proactively search for potential hires online to fill job openings and build talent pipelines.
Common ATS features
Application management: Track, manage, and store job applications. 88% rate this feature as critical or highly important.
Resume storage: Upload and store candidate resumes. 84% rate this feature as critical or highly important.
Job management: Create and manage company roles and job listings. 79% rate this feature as critical or highly important.
Interview scheduling: Schedule job candidate interviews. 79% rate this feature as critical or highly important.
Onboarding: Automate the process of turning new hires into legal employees.
Alerts/notifications: Enable pop-up notifications or email alerts for various events.
Assessment management: Create, administer, and grade assessments that test candidate skills and knowledge.
Background screening: Order and manage background checks on job applicants.
Collaboration tools: Share messages, files, and other important information with recruiting stakeholders.
Pipeline management: Track data on the various stages of the recruiting and hiring pipeline.
Resume parsing: Automatically flag job applications and resumes with important keywords or phrases.
Workflow management: Create and monitor workflows for repetitive recruiting tasks.
Tardy says many systems offer AI-powered functionalities that can make for a better and more personalized candidate experience: “One of the complaints I hear from job seekers all the time is that they submit their resume and never hear back—they feel like their resume is going down a black hole,” she notes.
“Until recently, it wasn’t uncommon for candidates to only hear back from a company once they moved forward in the process, but with AI-powered applicant software, you can make the process much more interactive and also provide feedback to applicants who are rejected.”
Tardy explains that AI systems can automatically generate personalized feedback based on a candidate’s performance in assessments, interviews, or qualifications based on the job description. By analyzing the gaps between the candidate’s profile and the qualifications for the role, the software can create a structured, consistent feedback template.
Top ATS benefits identified by users
More seamless communication between recruiters, applicants, and other stakeholders: Users say applicant tracking system features such as automated notifications, user tagging, and direct messaging improve collaboration and response timeliness.
“The integrated communication tool facilitates interaction with candidates and the internal team, ensuring seamless collaboration and quick response to queries.”
-Alfonso G., CEO in tech
The ability to customize software to your unique recruiting process: Users say their ATS has a ton of customization options to mold the software to their needs and preferences.
“The customizable templates and automated workflows have been particularly helpful in optimizing our recruitment efforts and maintaining consistency in communication with candidates.”
-Salome J., HR administrator in hospitality
Automated candidate tracking and insights: Applicant tracking systems automatically track candidates through recruiting processes and provide data to help improve those processes.
“It helped to organize and systematize candidate tracking, set up reporting for our in-house recruiters, and streamline data collection.”
-Tatiana R., HR employee in IT technology and services
Common challenges of ATS software identified by users
When it comes to challenges with applicant tracking systems, reviewers most often cite problems with system bugs or glitches that prevent them from accessing certain features.
The second most cited challenge is speed. Systems either run too slow during normal operation, or hit performance snags that cause lag.
A third top cited issue more specific to applicant tracking systems is candidate filtering. Users say filters either go missing, or they don’t function as expected to show only the candidates that they’re looking for.
And finally, buyers have to be aware of challenges that impact applicants. If the application process set up through your ATS software isn’t seamless, promising candidates may bounce. In a recent Capterra survey, 30% of job seekers didn’t finish a job application because it was too confusing, 29% because it was too time-consuming, and 23% because they encountered errors or glitches.7
Be sure to look for these common issues when reading product reviews. In addition, when you demo different applicant tracking systems, ask vendors about known issues that can affect system performance.
What is ATS software used for?
Analysis of our extensive ATS reviews highlight the most common use cases:
Managing the entire recruiting process from beginning to end: Recruiters use their ATS as a one-stop shop to attract, assess, and hire job seekers.
Creating and advertising job postings: Whether it’s an internal careers page, or an external job board or social media site, users post job openings in multiple places to attract the most job seekers.
Keeping track of applicants across multiple job openings: Features such as application filtering, keyword search, and notifications ensure no job candidates fall through the cracks.
Collaborating with managers on hiring decisions: Applicant tracking systems allow recruiters to communicate with hiring managers on talent needs and schedule candidate interviews with them.
Who uses ATS software?
Because recruiting is a cross-functional business need, and one that all sizes and industries of businesses have to engage in, the roles who use ATS software vary.
In a small business, an owner or hiring manager might use a basic ATS to post job openings. In larger organizations with dedicated HR personnel, recruiters or other talent acquisition specialists might use a more advanced ATS to source candidates, schedule interviews, and identify recruiting process bottlenecks.
Notes from our advisor calls support this wide variance, as some of the most common kinds of users that contact us about ATS software are HR directors (12%), HR managers (11%), and business owners (8%).
ATS software is intended to be used by businesses hiring for their own needs. If you’re a recruiting or staffing agency, there’s recruiting agency software and staffing agency software that have different features to support the specific needs of these types of businesses (such as client management).
The person who has contacted us for ATS software in the last year most often comes from companies with between $6-25 million in annual revenue needing a system for two to five users.
Common ATS integrations
According to our conversations with ATS software buyers in the past year, 81% prefer an integrated suite for their ATS needs. Instead of a standalone applicant tracking system, companies more often prefer to purchase a comprehensive HR or talent management suite that not only has applicant tracking capabilities but also those for other HR needs, such as performance management and employee engagement.
When buyers do need their ATS to integrate with other systems, analysis of our extensive reviews database reveals the three categories that most often integrate with ATS software are: HR software, recruiting software, and background check software.
Recent trends in ATS software
Artificial intelligence (AI) lends a helping hand: Gartner predicts that 80% of recruiting technology vendors will have embedded AI into their products by 2027. 3 AI in ATS software can help recruiters write job postings, source candidates, and even conduct screening interviews. But recruiters also need to be on the lookout for applicants using their own AI to deceive employers and land a job.
Keeping track of alternative credentials: With college costs rising, more and more employers are dropping degree requirements and focusing on increasingly prevalent “alt creds,” such as certifications and digital badges on resumés, instead. However, 71% of recruiters told us it's harder to evaluate the quality of alternative credentials than college degrees, so any ATS functionality that can help you track or determine the quality of alt creds is a plus.
Pay transparency becomes the norm: In 2024, 40% of recruiting leaders anticipate that their organization will share salary details in job postings across all of their locations—up from 15% in 2022.8 Pay transparency has become increasingly important to attract top talent, so you should leverage not only an ATS to maintain pay transparency consistently, but something like a compensation management tool as well to ensure that salaries are competitive in your area.
Learn more about how an applicant tracking system can help your business