All you need to know about AI and machine learning in HR

Andy Agouridis Future of HR Talent acquisition

Artificial intelligence (AI) and Machine Learning may be the hottest technology topics of 2021 in business. Most organisations are looking for ways to implement these technologies across departments to reap the benefits. If you think that HR is an exception due to its focus on people, think again.

AI and Machine Learning can now be applied to most HR areas, delivering impressive results. Not only that, but futurists claim that the future of HR will be based on these technologies. At the same time, there are several considerations about the use of AI and Machine Learning in people management. In this article, we present you with everything you need to know about this important issue. Let’s start with the basics.

Two colleagues talking on Zoom.


What is AI and Machine Learning?

AI is a field of computer science that focuses on the development of machines capable of solving cognitive problems typically associated with human intelligence. These machines are different from other existing technology, as they can perform tasks requiring skills including language processing, reasoning, and problem-solving. What about Machine Learning, you ask?

Well, some confuse Machine Learning as a technology different from AI, however, this is inaccurate. Machine Learning is a branch of AI that enables machines to learn from data and make predictions based on their learnings. While the details are out of this article’s scope, the concept of Machine Learning is based on pattern recognition. 

Benefits of using AI and Machine Learning in HR

Once upon a time, HR used to be called the personnel department. The personnel department was tracking and maintaining employee records, managing compliance, hiring people, paying them, and terminating them. In short, HR only operated in a transnational way and there was nothing strategic about it.

Today, things are very different and savvy businesses have placed HR at the heart of their strategy, as it is proven that people management can have a significant impact on their bottom line. However, this wouldn’t have been possible without technology, which has enabled HR’s transformation. Now, AI and Machine Learning can push the frontiers of the HR function further. Here is how.

Time and cost efficiencies

AI and Machine Learning can streamline HR across the employee lifecycle. The ability of applications using these technologies to gather large volumes of data, analyse it, and provide recommendations is unprecedented. Examples of efficiencies related to AI and Machine Learning include mapping resumes to job openings and allowing organizations to monitor employee engagement through surveys with minimal human intervention. These efficiencies free up time and financial resources from tasks that used to be manual, allowing businesses to focus them on strategic HR elements. 

Improved employee experience

According to a survey by Deloitte, a professional services firm, 80% of executives rate employee experience as critical but only 22% believe their organizations excel at it. We expect employee experience to develop into a key differentiator between top-in-class employers who attract and retain top talent and others that struggle to find and keep their people. If this is an area you haven’t focused on yet, have no fear. AI and Machine Learning can help you boost employee experience in various ways.

Your workforce is used to having advanced technology at their fingertips in their personal lives. If you are looking to offer them the best experience at work, don’t stay behind. A survey by ServiceNow, a software company, revealed that almost 1 in 3 professionals want easy and fast access to business information, similarly to Google. Some of them also mentioned that they would appreciate virtual assistants, such as Siri or Alexa, but for work-related tasks.

Enhanced decision making

Decision making is the cornerstone of every successful business. If HR wants to get established as a strategic business function, it needs to make the right strategic decisions. However, while most organizations gather and analyze a lot of data, they fail when it comes to recommendations and decisions. The main reason is that previous technologies weren't able to contribute to decision making, so businesses were relying on manual methods to interpret information and develop related recommendations. Now, HR departments can boost their decision-making capacity through AI and Machine Learning. For example, Natural Language Generation software can transform raw data to relevant insights faster and better than a human.

It’s clear that using AI and Machine Learning can be beneficial for your business. However, which areas of HR can be boosted by these technologies? Let’s have a look.

A woman working in HR and sitting with her computer.

How AI can be used in Human Resources


Talent acquisition has already been transformed through technology. Now, AI and Machine Learning can push the boundaries further, allowing organizations to hire top talent by using AI in recruitment. Sophisticated technology can be applied in several steps of the hiring process, including the below. 

1. Sourcing

  • Technology can uncover candidates who are the best match based on the job requirements. Machine Learning tools can process job application content in a sophisticated way emulating human behaviour.
  • AI can recommend vacancies to candidates, notifying them when there is a good match.
  • AI can predict how a candidate will do, including their projected performance or tenure.

2. Interviewing

  • Technology can enable candidates to become more self-sufficient when it comes to interviewing logistics, allowing them to schedule interviews on their own, recommending resources to them, and sharing with them other relevant information.
  • AI can use data from previous interviews to prepare targeted questions for recruiters and hiring managers, focusing on the candidate’s skill set and the nature of the job.

3. Selecting

  • AI can compare job candidates with existing successful incumbents of similar positions and make relevant recommendations to decision-makers.
  • AI can use internal and external compensation data to create personalized job offers based on the candidate and the position.

Compensation & Benefits

Compensation is a key driver for most workers. No doubt, it is one of the most impactful HR areas with savvy organizations looking to offer competitive, fair, and equitable pay to their workforce. AI and Machine Learning can empower employers to make the right remuneration decisions through functionalities including the below:

  • AI can provide market insights and recommendations for all roles based on your competitors.
  • AI can use existing data to calculate the odds of whether a candidate will accept a job offer.

Benefits are a crucial part of total reward and should be part of any well-thought reward management approach. However, selecting benefits, presenting employees with options, and processing their decisions can be a complex and clunky process. Luckily, technology has already automated part of the process. Now, employers can refine their Benefits further using AI and Machine Learning. Here is how:

  • AI can analyse market data and understand what benefits would be the most valuable to your workforce.
  • Technology can recommend relevant benefits to each employee based on their profile, personalising their experience.

Learning & Development

Career growth is one of the key criteria of top talent when it comes to selecting an employer. Also, having a highly skilled workforce makes sense for employers too, as it increases the quality of workers. While Learning & Development (L&D) is not a new concept, AI & Machine Learning can transform it. Let’s look into a few use-cases:

  • AI can understand each employee’s needs based on their job, performance, and learning habits, and provide them with personalised course recommendations.
  • Team learning can be a powerful experience. With the help of AI, businesses can now pair employees from different departments, driving collaboration and cross-functional learning.

Succession Planning

As employees move or retire, every company experiences turnover. Resignation, termination and retirement are all part of the employee lifecycle, however, they can leave gaps in an organization. Having a succession plan is one of the most strategic HR approaches to mitigate these risks and manage related issues:

  • AI can identify flight risks by analysing data related to each employee, including how long they have stayed in their role, what is their compensation history, and what is their potential career paths.
  • AI-powered tools could also support leaders to identify suitable successors for key roles.

Considerations when using AI in HR

While AI and Machine Learning can be beneficial to businesses in many ways, they don’t come without any pitfalls. While these issues can be eliminated when well-developed applications are used in the right way, it makes sense to keep them in mind. Let’s explore a few considerations below.

AI can be biased

Unfortunately, humans can be biased. While one would think that technology would solve this problem, this is not necessarily true. You see, AI and Machine Learning tech is still created, deployed, and used by humans. In practice, this poses a bias risk. For example, a resume-screening AI tool could favour men over women due to the way it’s been built.

There may be privacy considerations

As we discussed, AI and Machine Learning are based on data. However, when this data has to do with employees, there may be privacy issues. For example, an AI-powered tool that predicts attrition by analysing employee information, including their social media activity, may clash with GDPR, CCPA or ethical standards.

AI shouldn’t replace human interaction

Even if the technology becomes capable of replacing humans, this shouldn’t happen. Human-to-human interaction is a fundamental need of your workforce, required to drive a successful organization. However, this is a risk that can be managed - just make sure that technology is used in combination with your HR department, not instead of it.

Last updated:

Andy Agouridis

Andy helps candidates and employers connect faster and better. Apart from being a Jobylon contributing writer and a Careers content creator. He has a background in HR with Fortune 100 businesses, holds an MSc in HRM, and is a Chartered member of the CIPD.

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