Levelling the playing field: How AI can transform SME hiring

By Kevin Fitzgerald, MD, Asia, Employment Hero

Conceptual image on recruitment generated by Blue Willow.

The era of artificial intelligence (AI) is here and one function that could quietly reap its benefits is HR: specifically recruitment within small and medium-sized enterprises (SMEs).

SMEs continue to be blighted by talent shortages, with one global study of SME leaders revealing that talent acquisition and retention is a key challenge for nearly half of all businesses, only behind survival and expansion. An apparent challenge for smaller firms is that they are recruiting from a shallow pool of candidates and, within that, competing with large, well-established businesses for talent.

Given that SMEs are key drivers of economic growth, addressing these issues at a policy level is important and must be done consistently and continuously. Equally though, it is time for small businesses to reimagine the hiring process entirely.

Exploring AI solutions to tackle talent gaps

Conversations with several small businesses made it clear that finding and retaining employees due to increased overheads and limited resources hinders their productivity, growth and oftentimes their survival in a challenging macroeconomic environment. 

Small business owners typically spend too much time writing job descriptions and sifting through hundreds of résumés, speaking to interested applicants, and establishing meaningful connections with talent for future recruitment. It is a tedious and expensive undertaking under normal circumstances – but especially so in today's economic climate, where business costs are rising and fears of a recession are looming. 

In a recent survey we conducted among SMEs, 81% of Singaporean SME business leaders believe they can’t compete with multinational corporations for talent given the rising costs of recruitment. In order to expand and grow, employers need to find an easier, more seamless way to secure and maintain talent.

Once considered an expensive, futuristic tech investment, AI solutions are now well and truly within the reach of small businesses. From sourcing and screening candidates, to scheduling interviews and even reducing bias in the process, there are sophisticated AI tools that are increasingly improving recruitment results for businesses on a small budget.

Reaping rich rewards

The return on investment for AI-driven recruitment solutions can be tremendous. New, emerging studies already point to remarkable returns for businesses using AI-driven solutions, in the form of cost and time savings as well as strategic business benefits.

Addressing AI critics

As with any technological innovation, but especially with AI – there are plenty of critics. Within the recruitment industry, the reticence to adopt AI solutions has to do with risks of bias and redundancy of recruitment roles. 

The answer to both issues is the same: regardless of what solutions SMEs choose, recruiters won’t be replaced by AI. If anything, AI can help recruiters spend time on higher-value tasks, including improving the candidate experience, building on candidate insights and engaging with passive candidates. Importantly, talent acquisition teams can focus on scrutinising bias and demanding greater transparency from the AI platforms they use.

Small businesses are crucial to the nation’s economy, and today they face challenges on two key fronts: a lack of skilled and qualified staff needed for better productivity and future growth, and a serious cost-of-living crisis faced by their employees, leading them to look externally for job opportunities. AI-based solutions proactively address both these pain points by empowering employers to streamline key parts of the recruiting process, leading to improved talent attraction and retention, saving costs and time in the process.