Applicant Tracking Systems (ATS) have become the backbone of modern recruiting. They offer clear benefits: automating resume screening, organizing candidate data, and speeding up the hiring process. For companies inundated with applications, it seems like a no-brainer.

But there’s a growing downside that recruiters can’t afford to ignore: ATS may actually be filtering out some of the best candidates.

Here’s how:

1. Great Candidates Don’t Always Have “Perfect” Resumes

Top talent often focuses on doing outstanding work, not on keyword-optimizing their resumes for software. A brilliant software developer, for instance, might submit a minimalist resume that doesn’t align perfectly with the ATS criteria — and get discarded before a human even sees it.

Impact: Recruiters lose candidates who could bring extraordinary skills and perspectives simply because their resumes weren’t algorithm-friendly.

2. Creativity and Non-Traditional Paths Get Penalized

ATS tends to favor traditional career trajectories and cookie-cutter formatting. Candidates who have taken non-linear career paths, worked internationally, pivoted industries, or gained unique skills through unconventional experiences might be overlooked — even if they bring the exact adaptability and innovation companies desperately need.

Impact: The very diversity of thought and experience that fuels innovation is filtered out.

3. Keyword Overload Can Lead to Bad Matches

Savvy (but not necessarily qualified) applicants know how to “game” ATS systems — stuffing resumes with keywords without truly matching the role requirements. As a result, candidates who are better at gaming the system rise to the top, while genuinely qualified candidates may be buried.

Impact: Recruiters spend time with “great on paper” candidates who underdeliver in reality.

4. ATS Struggles with Certain Resume Formats

Even today, many ATS platforms struggle to read PDFs, graphic resumes, or resumes with tables and columns. Candidates who are innovative or use visually appealing formats (especially common in design, marketing, and tech) may be misread or rejected outright.

Impact: Potential star hires are eliminated over formatting — not qualifications.

5. Soft Skills Are Invisible to ATS

Traits like leadership, emotional intelligence, creativity, and cultural fit don’t easily translate into keywords. Yet these soft skills are often what separates a good hire from a great one.

Impact: The “intangibles” that define top performers are invisible to software filters.

So, What Can Recruiters Do?

ATS tools aren’t going anywhere — and they shouldn’t. But to truly unlock the best talent, recruiters need to balance technology with human intuition. Here’s how:

• Regularly audit and update ATS settings to ensure they aren’t too rigid.

• Manually review a random sampling of rejected resumes to catch hidden gems.

• Simplify job descriptions to focus on skills and outcomes rather than buzzwords.

• Use AI tools carefully, focusing on augmenting, not replacing, human judgment.

• Encourage human conversations earlier in the screening process, even if brief.

Technology should empower recruiters — not blindfold them. The future of hiring belongs to those who combine the efficiency of ATS with the irreplaceable insight of human evaluation.