AI Recruitment Market Analysis

AI Recruitment Market Overview

AI Recruitment Market Size was valued at USD 577.7 Million in 2023. The AI Recruitment market industry is projected to grow from USD 617.5 Million in 2024 to USD 1,053.16 Million by 2032, exhibiting a compound annual growth rate (CAGR) of 6.9% during the forecast period (2024 - 2032). Screening high-quality candidates from unlimited databases, improving time and efficiency, and decreasing overall spending in companies’ HR budgets are the main reasons driving market growth.

Figure 1: AI Recruitment Market Size, 2023-2032 (USD Billion)

Source: Secondary Research, Primary Research, MRFR Database, and Analyst Review

AI Recruitment Market Trends

Decreasing overall spending in companies’ HR budgets boosts market growth.

AI has become a part of everyone’s life in one way or another. It can be used in training machines through data labeling and developing AI pattern recognition for autonomous vehicles; AI has continued to match the human brain. Today, for example, with the help of video surveillance and deep learning, security systems worldwide can function better and more effectively.

AI plays a significant role in the overall recruitment process. It helps recruiters scan thousands of CVs using AI technologies, such as the Applicant Tracking System (ATS). In this way, recruiters can save time and fill the positions more quickly.

In many big companies, the recruiting process is automated and uses AI algorithms. These functions include initial screening to onboarding. Other AI tools, such as Bots, also can be said as robots, help set up interviews and easily respond to candidates’ questions. These bots use natural language processing (NLP) and interview analytics to assess candidates' suitability by skimming their soft skills and personality traits.

Figure 2: Average cost cut in HR process using AI, by Regions, 2022 %

Source: Secondary Research, Primary Research, MRFR Database, and Analyst Review

The above figure shows that in North America, around 40% of the companies use AI in their recruitment process, followed by Europe. While in Asia Pacific, China, Japan, and South Korea are the major countries implementing this type of software in their HR processes. This implementation will be a boon for the SME sector, too, and will be the driving industrial segment for Ai recruitment.

AI Recruitment Market Segment Insight

AI Recruitment Verticals Type Insights

Based on verticals type, the AI Recruitment market segmentation includes Government, IT and Telecommunication, Healthcare, BFSI, Education, Enterprise, and Others. The enterprise segment accounted for the largest share of this market and is expected to grow at the fastest CAGR of 9.14% through the forecast period. The enterprise sector includes manufacturing, trading, and packaging, which heavily utilizes AI for hiring.

Figure 3: AI Recruitment Market, by Verticals, 2022 & 2030 (USD Million)

Source: Secondary Research, Primary Research, MRFR Database, and Analyst Review

Moreover, the BFSI segment is projected to grow at a CAGR of 6.17% through the forecast period. Due to the financial industry's day to day changing dynamics toward a better hiring process, it is challenging for banks to keep their employees informed about the recent changes in their systems and train each of them. These factors contribute to expanding the BFSI market, which raises the demand for AI in the recruiting sector.

On the other side, AI recruitment technology can benefit any business because it streamlines tasks and reduces costs. One factor driving demand is the requirement to automate the hiring procedure inside a business. Sales will result from adoption in the AI recruitment market.

AI Recruitment by Component Type Insights

The AI recruitment market is segmented into software and services based on component type. The software segment accounted for the largest share and is expected to grow at a CAGR of 6.72% through the forecast period. The AI recruitment market offers tremendous potential for growth. Technology development is a crucial driver of growth. Software is constantly being improved. In software, new features and programs are always being added. In the future, software for AI recruitment will have a lot of new functions. More consumers will visit the market as a result of all these improvements. The automated procedure increases candidate engagement during the hiring process by making the interview scheduling software more user-friendly. The demand for automated procedures expanded due to efficient software and systems implementation, thereby boosting the growth of the worldwide AI recruiting market. However, factors such as threats from open-source recruitment software may hinder the market growth.

However, the services category is also anticipated to grow the fastest during the forecast period. Moreover, this category will show significant growth due to the expanding demand for technological infrastructure and resource development. As they can guarantee high security with their deployment, many large organizations now prioritize the services market area. While the IT administration personnel in the firm control the AI in recruitment, no outside service providers are involved in maintaining companies’ private information. Moreover, businesses that have not yet switched to a cloud platform may find the services market segment particularly advantageous. Throughout the forecast period, artificial intelligence in the recruitment market will increase due to the benefits of the services segment.

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February 2023 - The end-to-end overseas recruiting platform hire EZ said today that its next March 9 product release would include generative AI features. The update will use hireEZ's machine learning data and the Generative Pre-trained Transformer 3 model to help recruiter draught and deliver emails to job candidates more quickly than with conventional methods.  

AI Recruitment by Deployment Insights

The AI recruitment market is segmented into cloud and on-premises based on deployment type. The cloud segment dominates this market with a share of 67.2% and is also projected to witness growth opportunities with a CAGR of 6.81% in the upcoming years. Moreover, China, India, and Japan focus more on talent acquisition, intending to find highly qualified candidates whose abilities match the job description. The demand for AI recruiting technology has increased due to rising cloud-based service usage and national government initiatives to further digitization. The Asia Pacific AI Recruitment Market is expanding due to the increased demand for cloud-based AI recruiting solutions from SMEs in the region. The need for AI recruiting technology has increased due to the national government's measures to promote digitalization and the rising use of cloud-based services.

The on-premises category is expected to grow at the fastest CAGR due to in-house implementation by small firms. Occasionally, the pre-trained models or the computational or storage demands of the cloud might be improper or too expensive. An on-premises solution might be more appropriate in those circumstances. Also, a vast ecosystem of tools designed for on-premises environments can operate with enormous amounts of CPU power, which can be costly in the cloud. Some clients believe that doing this on-site is more cost-effective or favor a capital expense model over an operational expense one. Investing in on-premises infrastructure rather than using cloud-based services can make more sense if your company decides to get more involved in this or roll out AI at scale.

AI Recruitment Regional Insights

This market has been segmented by region into North America, Europe, Asia-Pacific, and the rest of the world. The North American region dominated this market with a share of 38.2% in 2022 and is expected to grow at a CAGR of 5.43% through the forecast period. American businesses quickly adopt AI-based machine learning technologies to guarantee the most efficient hiring procedure. Also, the expansion of IT businesses in the United States is fostering market expansion in this area. Innovative technologies like artificial intelligence and machine learning were initially applied in the US. Due to its advanced economic system, robust network infrastructure, and easy access to qualified specialists, China currently dominates the market, followed by Canada.

Furthermore, the Asia-Pacific region is also expected to hold the second-highest position in this market during the forecast period. This region has a large number of software vendors. Also, the variety of job duties fuels the expansion of the AI recruitment industry. Throughout the predicted period, this region will have the second-best profitability rate. Also, there are numerous software vendors in this area. The rise of the AI recruitment sector is also fueled by the diversity of job duties. Over the anticipated period, these areas will have the second-highest profitability rate.

Figure 4: AI RECRUITMENT MARKET, BY REGION, 2022 and 2030 (USD Million)

Source: Secondary Research, Primary Research, MRFR Database, and Analyst Review

Demand for AI Recruitment is growing in several countries across the North American region.

Also, AI would help recruiters access a broader talent pool through online career boards, social media platforms, and agency databases. In addition, recruiters would have the chance to look at specific profiles, such as former employees of the organization, during screening. These applications of implementing AI will drive artificial intelligence in the recruitment market's growth during the forecast period.

AI Recruitment Key Market Players & Competitive Insights

These markets' leading players will form new collaboration agreements during the anticipated timeframe. That will result in market growth. The major market participants are starting to use AI for hiring in the healthcare sector.  

Major AI Recruitment market players include PandoLogic, Inc., Leoforce, LLC, Harver B.V., Hackajob Ltd., Jobvite, Brilent, Inc., Entelo, Inc., and others, who are focusing on developing their business strategies.

Key Companies in the AI Recruitment market include.

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  PandoLogic, Inc.

  
  


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  Hackajob Ltd.

  
  


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  Zoho Corporation

  
  


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  Leoforce, LLC

  
  


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  Harver B.V

  
  


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  Jobvite

  
  


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  Brilent, Inc.

  
  


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  Entelo, Inc.

  
  


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  SmartRecruiters

  
  


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  CVViZ Softwares Pvt Ltd

  
  


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  HireVue

  
  


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  Talentrecruit

  
  


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  Beamery

  
  


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  TalentMind

  
  


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  Ultimate Software

  
  


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  Automatic Data Processing LCC

  
  


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  Oracle Corporation

  
  


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  IBM Corporation

  
  


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  Google LLC

  
  


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  SAP SE

  
  


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  Mya Systems Inc.

  
  


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  Deloitte

  
  


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  Quantegene

  
  


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  WekaIO

  
  


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  HireEZ

  
  

AI Recruitment Industry Developments

• In May 2023, With the latest announcement of the enhancement of the relationship between SAP and Microsoft, the vision of an enterprise-ready generative AI that is capable of augmenting worker performance and growth is slowly coming into focus. Enterprises will be able to better retain, reskill and recruit workers to fill skills gaps when SAP SuccessFactors solutions are accompanied by Copilot in Viva Learning also Microsoft 365 Copilot.


• In September 2023, Employ Inc. reported that they were acquiring a smaller tech firm that focuses on recruitment analytics for A.I. The purpose is to strengthen the portfolio of Employ Inc. by bringing in top-notch predictive analytics techniques that would allow them to provide actionable insights to clients that would assist them in recruitment.


• In July 2023, Workday, Inc. announced the release of a new feature, “Workday Talent Insights,” which has been powered by AI technology. This product applies machine learning models to estimate employee effectiveness and assist organizations with pre-emptive measures for employee retention along with recruitment strategies that streamline the entire hiring process.


• In March 2023, Microsoft Corporation expanded its AI capabilities in recruiting by further embedding LinkedIn’s data analytics within Microsoft Teams. This advance has the potential to improve the recruitment process by delivering more extensive candidate profiles and enhancing the interactions of the recruitment team members.


• July 2023: Google's usage of AI models from Meta and Anthropic on their platform was expanded with dramatic effect. This partnership focuses on embedding generative AI into tools for HR and recruitment, such as candidate screening tools and interview scheduling tools. By increasing AI model usage, Google is going further to disrupt the conventional nature of HR technology by integrating AI analytics and recruitment tools.


• In July 2023, A consortium between SAP SE and IBM was established to enable the integration of AI-based Conversational Cloud AI HR solutions within the modules of SAP’s Success Factors. This collaboration will aim at improving skill assessments in organizations as well as diversity and inclusion analytics in organizations as more AI powered intelligence is applied. HR managers can apply this integration apply sophisticated screening, advanced resume parsing tools and tools related to employee development.AI Recruitment Market Segmentation

AI Recruitment Component Type Outlook

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  Software

  
  


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  Services

  
  

AI Recruitment Deployment Type Outlook

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  Cloud

  
  


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  On-Premises

  
  

AI Recruitment Verticals Type Outlook

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  IT & Telecom

  
  


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  Government

  
  


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  BFSI

  
  


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  Healthcare

  
  


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  Education

  
  


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  Enterprises

  
  


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  Others

  
  

AI Recruitment Regional Outlook

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  North America

  
  

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    US

    
    
  
  
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    Canada

    
    
  
  
  
  

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  Europe

  
  

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    Germany

    
    
  
  
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    France

    
    
  
  
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    UK

    
    
  
  
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    Italy

    
    
  
  
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    Spain

    
    
  
  
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    Rest of Europe

    
    
  
  
  
  

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  Asia-Pacific

  
  
  
  
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    China

    
    
  
  
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    Japan

    
    
  
  
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    India

    
    
  
  
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    Australia

    
    
  
  
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    South Korea

    
    
  
  
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    Australia

    
    
  
  
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    Rest of Asia-Pacific

    
    
  
  
  
  


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  Rest of the World

  
  
  
  
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    Middle East

    
    
  
  
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    Africa

    
    
  
  
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    Latin America