How AI can Improve HR Processes for Small Businesses

Automate the recruitment process

This is probably the most popular application of AI. Algorithms discover certain keywords in resumes, shortening the time it takes to find qualified candidates. With the help of technology, small businesses can automate their recruitment process and reduce hiring costs.

Applicant tracking systems (ATS) cross-reference applicants’ resumes with the advertised job description and rank them by suitability for the position. These tools are now so widespread that the internet is full of recommendations for job seekers on how to get around them.

Keep your sensitive HR data safe from hacking

With both job openings and turnover remaining at record highs, the major risk is the human element. More employees are in and out, sometimes leaking sensitive information without realizing it. And working from home can present more cybersecurity threats.

Protecting confidential data is becoming increasingly difficult for small businesses. Many don’t have their own in-house cybersecurity team, and sometimes former employees breach data confidentiality without realizing few “firewalls” are in place.

AI solutions can automatically detect anomalies — unusual activity within networks — and send an alert. These advanced tools are particularly helpful in remote working environments. HR technology providers, such as Oracle, are already incorporating AI-based data security solutions into their products.

Ensure diversity in the workplace

Diversity is something both employees and businesses want. According to Deloitte, companies that encourage inclusive cultures have 22% lower turnover rates than those with homogeneous teams.

But recruiters are people. They have biases, they let emotions influence their decisions, and they walk a familiar path, even when their aim is to build diversity. Sometimes the language in a job ad, for example, can discourage certain candidates from applying. With AI, small businesses can make better choices and go beyond their typical hiring decisions.

Help applicants develop their communication skills

Some great candidates are overlooked simply because they can’t explain themselves properly. Poor communication skills are often an issue in the IT industry. Also, for many applicants, English is not their first language. Due to high demand for certain tech qualifications, companies recruit candidates from outside of the U.S.

With AI, qualified applicants can improve their communication skills and avoid frustrating linguistic mistakes. For example, an AI-based language learning solution,, is already training candidates in the emerging markets applying for roles in the U.S.  The platform allows them to practice specific real-life scenarios, such as a job interview, with realistic AI robots.

Make better decisions about promotions

People leave their jobs not just looking for higher pay, remote work, or flexible hours. Over 40% of employees named the lack of opportunity for upward mobility as the number-one reason for quitting their jobs, according to a McKinsey report.

And it’s a global trend: the company’s survey included more than 12,000 individuals in the U.S., Canada, the UK, Australia, India, and Singapore.

AI can match existing employees with new opportunities inside the company based on skills, interests, and preferences. According to the HR research and advisory firm McLean & Company, “AI-driven internal talent marketplaces are key to talent growth and retention.”