Choosing the right candidate for a job opening can be challenging for any recruiter.
A bad hire can seriously impact the company’s culture and team’s performance, increasing turnover costs. On top of that, there’s a layer of complex tasks in the recruiting process that can be time-consuming and costly at the same time.
Therefore, having a software solution, such as ATS, that emphasizes the benefits of automating the hiring processes while diminishing the administrative and manual tasks can streamline and improve the search for the right candidate.
By managing and organizing the recruiting activities for the team from start to finish, the ATS became a “must” in the HR toolkit.
Hence, this article will focus on understanding the applicant tracking system pricing while at the same time enlisting its values for any business and organization.
How Much Does an Applicant Tracking System Cost?
An ATS pricing varies from model to model for two reasons: the size of the business and the features it offers.
Thus, the main question for hiring managers before purchasing an ATS solution is: how much does an applicant tracking system cost?
There is no simple answer because of the different applicant tracking system pricing models that can cost anywhere from $5,000 to $50,000 per year.
Also, there are free ATS solutions that are best for companies that process under 20 jobs annually.
Understanding the Applicant Tracking System Pricing
Although the applicant tracking system pricing is challenging to break down, finding the right solution depends on the business size. Big enterprises that manage a lot of job openings and candidates may need more features from an ATS solution. From the beginning of the recruiting process to choosing the right candidate and onboarding, efficient ATS software with different features may greatly help hiring managers and recruiters.
The right software keeps the talent acquisition process organized and effective by streamlining the overall hiring process, from posting to job boards to scheduling interviews and resume parsing.
On the other hand, unlike big companies, small companies may not have many job openings, and their HR departments may want to choose a simpler ATS that doesn’t have many add-ons.
Considering the various models, the cost will also differ according to the vendor and their pricing strategy. Hence, some of the methods of payment include:
- Pay-per-job (the cost depends on the number of applicants or number of job openings, i.e., pay-per-applicant or pay-per-job opening)
- Pay-per-employee (the cost is determined by the number of employees regardless of the hiring frequency)
- Flat fee (some ATS vendors offer a flat fee for the use of their software, either in the form of a monthly subscription model or a one-time license purchase)
- Tier-base pricing (based on the features and capabilities offered in the subscription plan)
The billing cycle (monthly or yearly) may also affect the overall cost of the product, with the annual billing option providing the company with more cost savings in the long run.
Common Pricing Models
The most common applicant tracking system pricing models include:
- A subscription license – recurring fee—usually monthly or annual,
- A perpetual license – a one-time license fee to get permanent access to the software and its features
- Free ATS solutions – free of charge, but there is a cost for implementation, integrations, maintenance, and additional user seats.
Subscription-based pricing means customers pay a monthly or annual fee to access and use the ATS software.
The cost depends on the different tiers or plans that can accommodate various business sizes and needs. These plans often include different levels of features, support, and usage limits.
Annual subscriptions might come with cost savings compared to monthly plans.
Also, with most ATS solutions deployed in a cloud-based platform, the vendor hosts the software, so companies typically pay a monthly or annual subscription fee.
The most common pricing model falls under this subscription type.
Companies are charged based on the number of recruiters/employees with administrative access to the ATS.
The pay-per-recruiter/pay-per-user pricing strategy is usually designed for professional recruiting firms and agencies. The average monthly cost per user is between $60 and $100. However, there may be an extra charge for activation.
With the tiered applicant tracking system, the ATS’s tier plans determine the pricing. Usually, the basic-tier plans include limited applicant features such as job posting and candidate sourcing tools. Their prices start at $8 per month per hiring team member. These solutions are good for small businesses or teams with simple job posting, interview scheduling, and applicant tracking needs.
ATS software solutions for mid-market or medium-sized businesses and organizations tend to have more advanced features and capabilities, such as recruiting CRM (candidate relationship management), portal management, talent management tools, and behavioral and background screening.
This category offers premium pricing plans that typically cost from $80 per recruiter per month and can go up depending on the number of hiring managers in the team.
High-end or advanced plans include additional premium features such as third-party social media and job board integration software, API access, top candidate benchmarking, and custom team analytics. Per recruiter, per month prices could start anywhere from $144 and go all the way into the thousands, depending on the size of the hiring team.
There are also ATS software solutions that are custom or quote-based. This means interested companies should contact the vendor directly to ask for a specified requirements cost. Some vendors offer this applicant tracking system pricing model for high-tier or enterprise plans, including large businesses and organizations with bigger needs and budgets.
On the other hand, some vendors offer custom pricing for every package type. This is to ensure all business customers will be offered a plan that perfectly suits the company’s needs, regardless of the number of users or seats. For example, a small business can still get a high-end plan for reasonable pricing by choosing only the needed features.
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Factors influencing ATS pricing
Because of the different ATS solutions, some factors directly influence the applicant tracking system pricing. There are a few additional costs that the companies should consider before purchasing the right ATS.
Some vendors may offer specific features as add-ons, such as onboarding or background checks, video interviewing software, performance management, tracking, and surveys. That way, companies are only paying for the features they need.
Implementation and maintenance
Prices for implementation and maintenance services can also vary by vendor. This includes a dedicated implementation specialist, installation, software customization, data migration, and integration with other software. Some ATS software solutions also include basic implementation and maintenance services in the pricing.
The base subscription pricing often covers basic customer support (knowledge base, email support). However, the mid-tier will get email, live chat, or phone support, while the highest-pricing tier will get priority or dedicated customer support. Also, some vendors offer full customer support on all channels (email, chat, phone) for all of their subscriptions.
Assessing the Value of an Applicant Tracking System
A lengthy hiring cycle can be frustrating for both employers and candidates.
ATS software keeps the recruitment process automated and structured. It’s fast, efficient, and straightforward. Optimizing the job recruitment process using an ATS can shorten the hiring cycle by 60%.
Furthermore, the software has a built-in solution to cross-reference the job description with the candidate’s skillset and work experience. Doing that eliminates candidates who are not a good fit and surfaces candidates who are most likely to meet the job requirements.
Yet, writing a proper resume is essential for landing a job and getting that first interview. On average, an ATS rejects 75% of candidates immediately based on the potential fit criteria. If the ATS can’t read or interpret a resume, it can lead to missing out on potential great employees and great talent pool candidates.
Luckily, ATS resume templates can help the candidate format the CV, and pinpoint what information to use while following the resume guidelines.
Having a better overview of candidates and keeping all the documents in a recruiting database is another benefit that adds value to an applicant tracking system. Also, the data for each job posting is saved and stored. It means the eligible candidates can still be accessed by recruiters to interview for a similar job opening.
One of the major, long-lasting benefits is that ATS retains the employees for longer. With the best candidates put in the roles that are a perfect fit for them, they’re more likely to stick around for longer within the company.
Cost vs. Value Analysis
The best way for companies to measure the worth of investing in an ATS is to calculate the ROI (return on investment). As referred previously, an applicant tracking system pricing can vary depending on the features and the model the company needs most.
According to GetFive, a small company with just eight employees can save $10,000 in wasted time and effort using an ATS.
Moreover, ATS solutions can improve three of the most significant hiring metrics: time-to-hire, cost-per-hire, and quality-of-hire.
Firstly, with an ATS, tasks that previously required hours of work can now be completed quickly and easily. Survey results show that 86.1 percent of the recruiters say that using an ATS has increased the speed at which they hire candidates.
Secondly, with automated recruiting tasks, the HR hiring managers and recruiters need less manual work to fill a position. This makes the hiring strategy more productive and cost-efficient.
Finally, high-quality candidates don’t stay available on the job market for long. A company can get top candidates by speeding up the recruitment process.
One handy feature of an ATS is that the system gets regular updates that correspond with the current law regulations. In this way, companies are in compliance with the newest employment regulations that prevent discrimination and other unfair hiring practices.
Even though discrimination shouldn’t be an issue today, there is still unconscious bias in the workplace. With recruiting software for hiring, each application will be read objectively. It not only ensures the company gives each candidate an equal chance but also protects it from any potential legal issues.
Factors to Consider
Before purchasing an ATS solution, a few factors need to be considered.
1. Business Needs
Determining the company’s specific needs means considering the organization’s size, the number of job openings, the types of positions, and the available budget for an ATS. The cost of the software has to fit within an organization’s budget. All additional costs have to be carefully reviewed so the company doesn’t end up paying for something that’s not required or doesn’t help the recruitment process.
2. Different Models
Researching different options from various vendors and comparing their features and ATS pricing can result in the best purchase. However, when looking for ATS features, the company must consider the challenges the HR teams face today and those that can be predicted.
An ATS tailored to the company’s recruitment processes, branding, and workflows will help with the primary objective – finding the perfect candidate. For example, if the company relies on video interviews to fulfill positions, the ATS must provide video interviews as one of its features.
3. Demo Versions and Free Trial
Many ATS vendors offer demos or free trials, so it’s an advantage to test the software before implementing it. This is especially important for early-stage businesses that do not have a streamlined recruitment process yet. It also allows employees to experience the software and its tech requirements directly.
4. Integration Capabilities
An ATS that integrates with the current software avoids the tedious process of manually entering data into separate systems — and the high risk of error that comes with it. Integration with other HR systems, such as performance management and onboarding tools, can streamline the HR processes and make them more efficient.
5. Excellent Candidate Search Functionality
An ATS with superior search capabilities allows recruiters to search for candidates by skills, location, experience, and other parameters. Also, it helps find the most qualified candidate from the talent pool.
6. Implementation Timeline
Implementing an ATS solution is a weeks-long process of transferring data, training the employees, and setting up workflows. Making an implementation timeline can narrow down the choices.
7. Online Reviews & Candidate Case Studies
Today, there is an online review for almost everything. Great ATS providers will have clients who want to share their positive experiences and results with the software.
A business has to comply with the current law of the country. Various rules and regulations must be obliged and visibly disclosed as terms and conditions for the candidates. For example, one rule that applies to countries is the storage of the candidate’s personal information.
An ATS helps the organization stay compliant by consolidating all the information on the candidates in one place. A GDPR and CCPA-compliant ATS offers robust security features like two-factor authentication, data encryption, and regular backups.
9. Customer Support and Training
The success of an ATS solution depends on the quality of customer support and training provided. Dedicated customer support and comprehensive training for the team using the ATS is essential for efficacy and long-term usage. Also, involving the team members in the selection process may help them choose the right solution because the HR departments know the company’s recruiting needs.
10. User Interface
An ATS solution that is user-friendly, intuitive, and easy to navigate is one way to successful implementation. An ATS with a modern, clean, and visually appealing design is crucial for easier administration. The user interface should be designed with the end user in mind, facilitating collaboration and communication among team members.
Bringing the right people on board is critical to success.
This hiring trend will continue, as many executives agree that attracting and retaining top talent is a leading risk concern for 2023. The right applicant tracking system software improves the talent pool and saves time and money in the search for the most qualified job candidate.
Thus, analyzing the applicant tracking system pricing is vital for choosing the most convenient solution for the HR department’s needs. Although finding the best ATS software is not straightforward, it is still worth researching the various models. Ultimately, choosing a proper ATS gives the company an advantage over its competitors in the market.
- Applicant Tracking (ATS) Software Pricing Guide 2023 (Crozdesk)
- ATS pricing: How much does an applicant tracking system cost? (Workable)
- 9 key considerations when choosing your Applicant Tracking System (ATS) (Gattaca)
- A Guide to Applicant Tracking Software Pricing Models (Software Advice)
- How to choose an Applicant Tracking System? The complete selection criteria (Freshworks)
- The Ultimate ATS Buying Guide for 2023 (Oorwin)
- 9 Rules for Choosing a Good Applicant Tracking System (ClearCo.)
- How To Measure Recruitment Metrics And Track Your Goals (Forbes)
- ATS: A Complete Guide for Recruiters In 2023 (GoHire)