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Hiring paradox AI both hurts and helps
ETtech | July 15, 2025 1:40 PM CST

Synopsis

The rise of AI-generated resumes and interview prep tools is flooding recruiters with applications, making candidate screening more complex. While large firms adopt AI-powered assessments, smaller ones rely on in-person interviews. Challenges like AI bias, hallucinations, and authenticity concerns persist, prompting calls for better tools, human oversight, and recruiter training.

Widespread use of AI-driven tools by candidates is creating problems for recruiters. But there are some plus points too. Until a couple of years ago, the biggest hurdle for a job seeker was to get past the application tracking system (ATS), a bot that is used for filtering applications, to get shortlisted for a desired position. This meant getting the error free resume with right keywords and formatting.

With the advent of generative artificial intelligence and proliferation of new age online tools, all of this can be done in a matter of minutes. This is great news for candidates, but not so much for recruiters, who are now dealing with a deluge of resumes for roles. While some companies are deploying AI tools, and stringent assessments for filtering candidates, smaller firms are looking at increasing the in-person interaction to hire the right people.

CV deluge

Neeti Sharma, CEO, TeamLease Digital said that close to 25-30% of the resumes are now made using AI, compared to 8% last year, and the numbers are growing.

Kamal Karanth, cofounder, Xpheno, shared that as much as 50% of CVs are written by ChatGPT, matching with the job descriptions. He pointed out that as a result the firm is seeing 25% increase in the number of CVs they receive for any job openings.

Vishalli Dongrie, Partner and Leader-Workforce Transformation, PwC India, said, “ATS systems have been using technology to filter candidates even before the advent of widespread AI tools. With AI-enabled resume crafting, the fitment matching has become more accurate. This has led to an increase in the number of applicants immediately following a job posting.”

An executive with a Bengaluru-based consulting firm told ET on the condition of anonymity that this has increased the time taken to hire people as shortlisted candidates after the initial filtering process has increased, requiring more human intervention, he said.

Experts also pointed out the need for predictive analytics and sophisticated tools based on historical data to hire candidates as well.

Human and tech intervention

Sunil Chemmankotil, Country Manager, Adecco India, said that apart from crafting polished resumes, candidates are also simulating interview responses making it challenging for recruiters to assess their capabilities, making traditional screening methods insufficient.

“Recruiters now require deeper subject-matter expertise and more sophisticated tools to evaluate candidates effectively. To address this, many organisations have adopted AI-powered platforms capable of analyzing behavioral cues during virtual interviews, such as detecting lip-syncing or external prompting, to ensure the integrity of the hiring process. PWC’s Dongrie said that for organisations with limited and smaller hiring volumes, the dependency for filtering candidates primarily is at in-person interview stage.

“However, for organisations with high-volume hiring such as retail banking, insurance, pharma-sales, the focus has shifted towards implementing stringent assessments for filtering candidates prior to interviews. Focus is now more on technical assessments along with existing psychometric and behavioural profiling exercises,” he said.

Xpheno’s Karanth said that they are using AI to filter the top 50 out of 200 resumes received, and screen further depending on their pool till they reach 5-10 candidates. “As of now, only guarding is through human intervention. You cannot depend on AI as of now in this regard because that might not lead to a fruitful outcome. For more senior roles, around 70-75% of the applications are through references,” he said.

Divya Bajaj, Fractal-Hiring, Lead Manager, said that they have evolved their hiring process to include technical assessments, case studies, and Proctored LIVE interviewing, which use AI to detect eye /hand movements.

But the challenges of using AI in hiring still remain.

Challenges

Teamlease’s Sharma said that AI hallucination and bias are still concerns. “The biggest challenge this poses is making sure that it doesn’t have the same bias that a human recruiter would have,” she said.

While AI can cover the blind spots, it is getting harder to differentiate between an AI-generated video and a real video of a candidate. “We need to make sure that our recruiters are skilled enough to identify this difference; otherwise, we would fall flat in the market. The only solution to this is the upgradation of data sets, proper and regular monitoring, and governance,” she said.

Chemmankotil said that while AI helps with productivity and improve recruitment processes, its inherent flaws makes it harder to rely on them completely. This includes concerns around bias and fairness and the need for platforms that can be integrated into current systems to make it efficient.


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