AI For Diversity Recruiting: Is It Doing Its Job?

Welcome to my weekly Q&A roundup. (Scroll down to find the Q&A.)

If this is your first time here, welcome. I spend a fair amount of time speaking at events and conferences. At the end of my presentations, I leave space for audience members to ask questions—tough questions, brave questions, you name it. The level of candor and curiosity always inspires me, and I want to share that sentiment with you. So each week, I pick one question that I believe others would find most instructive and publish my response to it here.

The purpose of this weekly tradition is transparency and inclusivity.

Transparency: a behind-the-scenes look at my day-to-day.
Inclusivity: bringing others along in the journey.

Be Brave™

Is AI Hiring Software Effective At Doing Its Job?

Question:

Are AI software solutions for recruiting and hiring worth it from a DEI perspective?

Answer:

The answer to your question depends on how you define worth it. Think of it this way: you “hire” software to do a job. How good is it at doing its job? Well, that depends on the problems you want it, the software, to solve.

From a DEI perspective, you “hire” the software to increase levels of diversity, equity, and inclusion within your organization. That’s its job. Is it moving the metrics you want it to move? Your employee DEI data will let you know. (And if you don’t have DEI data, it’s time to start collecting it.)

Companies Need To See ROI From Their Tech Investments

Now let’s go a step further. Suppose you ask the same question but remove the final qualifier, “from a DEI perspective.” You’d be asking: Are AI software solutions for recruiting and hiring worth it?

For businesses, what makes a software solution worth it is ROI. To that extent, only 10% of managers report seeing significant financial benefits from their investments in AI. Even though 70% of these same managers understand how AI can generate value for their businesses, only one in ten are reaping significant economic gains from AI.

That lackluster performance doesn’t seem to be souring enterprise adoption of AI, however. If anything, it’s the opposite:

95% of companies believe AI will drive important digital transformations for their organizations
Corporate investment in AI is expected to reach $110 billion (up from $50.1 billion in 2020) by 2024
81% of employees believe AI can improve their performance and 68% want their employers to adopt more AI tools to help them do their jobs

AI For Talent Acquisition: Does It Move The Needle on Inclusion & Equity?

Talent acquisition is one area where AI tools could help employees do their jobs and improve performance. However, could doesn’t necessarily mean should. AI solutions need to be worth it. And based on what I explained above, we need to look for two things:

AI solutions need to show improved levels of DEI at your organization. You can hire for diversity, but you must build for inclusion. If your workplace isn’t equitable, your newly acquired diverse talent won’t stay. Recruiting and hiring are one part of the employee lifecycle.
AI solutions need to demonstrate ROI and map that ROI to DEI. Pipeline’s original research found that every 10% increase in intersectional gender equity yields a 1-2% increase in revenue.

I’ll leave you with this final insight. In a study of more than 800 organizations analyzing over 80 different DEI practices, researchers found that diversity recruiting ranked among the least impactful practices for improving levels of diversity, equity, and inclusion within companies. “Without an inclusive environment in which people can be their authentic selves, recruiting often becomes a revolving door.”

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