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Top AI tools for staffing agencies in 2023


Every staffing agency felt the impact of the COVID-19 pandemic and adapted by making sweeping changes in their recruitment practices. Enterprise recruiters, staffing agencies, and managed service providers have already been taking steps to mitigate the disruptive effects of the pandemic, including higher clarity and relevance in their candidate data, revamping employer branding, and streamlining virtual hiring methods.

A survey on LinkedIn clearly states how the biggest skill for any staffing agency was adaptability in 2021.

Agencies are already doubling down on things like remote working, productivity, virtual interviews, talent advisory training programs, internal mobility, virtual onboarding, and more. At the same time, every staffing agency has also had to contend with the increasing emphasis on diversity, equity, and inclusion (DEI) in the modern workplace.

More candidates are also choosing employers based on their perceptions of their commitment to inclusion. 2021 saw 70% of job aspirants confirming that they wanted to work for an organization showing commitment towards inclusion and diversity.

More recruiters are now working on doing away with entry barriers and building pipelines of broader and more diverse talent. Also, more companies and on-demand staffing agencies are looking for tools to help them with diverse hiring and bias elimination.

More organizations and staffing agencies are steadily adopting specialized AI tools for recruitment services and solutions, many of which are AI-based. This enables better screening for recruiters, doing away with inherent or unconscious biases while offering greater visibility into the candidate pool at various stages of the recruitment procedure.

These tools are also simplifying candidate engagement and communication throughout the process while automating many other tasks which otherwise take up a lot of time and resources for organizations.

AI is also helping automate candidate sourcing and search processes, thereby widening the available pools for recruitment.

In this guide, we are going to touch upon various aspects of staffing agency tools, how they help accelerate recruitment services and how to choose the best AI recruitment tool.

What is a staffing agency?

A staffing agency is one that specializes in matching job seekers with companies offering varied positions. They source and recruit candidates on behalf of companies. Staffing agencies help candidates find more job opportunities while giving companies access to diverse talent pools simultaneously.

Why do companies use staffing agencies?

Companies use staffing agencies for several reasons, including time, energy, and monetary savings. Some of them are outlined below:

Many companies often assess potential employees through their staffing agency. The latter covers initial payroll, hiring, and benefits. Post training and orientation, the company absorbs the employee directly. The company can try out and analyze whether these employees are the right fit or not.

On-demand staffing agencies help companies source quality manpower for project-based or sudden requirements, which they find difficult to fulfill on their own.

Companies outsource virtually the entire sourcing/search process for candidates across job positions. The initial assessments and interviews are also handled by the agencies. This saves time, energy, and money.

Companies often face issues in finding suitable talent in their regions or within their industry. This is where recruitment services come in handy.

What are the five most important indicators of the staffing process?

Here is a closer glimpse into some of the crucial indicators for any staffing process. These could be a blueprint for any staffing agency:

Time to hire

Can be subdivided into KPIs (key performance indicators) like submission-to-interview and interview-to-hire.

Quality of hire

Measured in several ways, such as time to productivity or managerial and organizational feedback.

Talent sourcing

Any staffing agency will emphasize sourcing the right talent across channels. This will lead to building a compatible, qualified, and diverse workforce, a key indicator of performance.

Cost per hire

This includes the entire cost to the staffing agency of delivering the hire, including payroll, technology, overheads, added expenditures, etc.

Talent pipeline

A major KPI is the talent/candidate pipeline of a staffing agency. Companies always seek swift access to candidates who are qualified and have established relationships with recruiters (which means they have been assessed).

What are the challenges faced by a staffing agency in recruitment?

There are several hurdles that recruitment services or staffing agencies may face at the time of hiring. Many of these are more common than one would think.

  • A sudden demand for contract/temporary workers, especially due to workload fluctuations.
  • Higher labor costs than affordable.
  • Gaps in the specific talent of candidates.
  • Demographic challenges.
  • Compliance with DEI goals of companies.
  • Costly overtime.
  • Higher employee attrition (at some organizations).

What are the top software solutions used by staffing agency recruiters?

Every staffing agency has already installed technology for a faster and more efficient process overall. Here are some of the top software solutions that recruiters usually opt for:

  • Job boards: Job search platforms or job boards automate postings on leading sites and some pre-vet applicants on behalf of companies.
  • Top programmatic advertising tools: These tools automate the buying, placement, and optimization of job advertisements throughout the internet.
  • ATS solutions: Applicant tracking systems (ATS) collect information on aspirants in databases while automating the screening of resumes and various other tasks.
  • CRM solutions: Candidate relationship management (CRM) software builds database-oriented candidate interactions, scanning earlier applications for suitable matches.
  • Chatbots: Chatbots work on AI or customizable templates, offering automatic answers to questions of applicants, scheduling assessments/interviews, and integrating with job boards/sites.
  • Diversity recruiting tools: Software solutions that help companies to meet their diversity hiring goals.
  • Premade assessment software: Tests the abilities of candidates with premade or customized assessments.
  • Virtual interviewing software: Helps candidates record answers to questionnaires and submit them digitally. Text, voice, or video may be used for holding interviews at the pre-screening stage.

How does AI recruiting software offer versatility?

AI recruiting software is a versatile and dynamic tool for any staffing agency, enabling them to harness numerous benefits throughout the process. Some of the key advantages include the following:

  • Automation of repetitive and manual tasks in the hiring process.
  • This frees up talent acquisition personnel to emphasize candidate engagement and nurturing talent.
  • Reducing the time it takes to recruit talent while automating sourcing, screening, and candidate engagement.
  • Integrating with ATS and CRM systems to connect companies quickly to bigger talent pools.
  • Streamlining the tracking of applications in secure databases.

ROI of using AI recruitment for on-demand staffing

AI-based staffing solutions generate positive ROI for a company in various ways. They help in sourcing diverse and wider candidates, promoting DEI goals, and ultimately helping companies attract the best talent.

They also save time on the entire procedure, thereby considerably bringing down the costs of recruitment. If the basic impact is to be analyzed as a case study, then consider how such software automates all online communication, assessments, and tasks for recruiters.

Many recruiters spend much of their time sending and writing emails. Suppose recruiters or a staffing agency dispatches a few hundred emails each week or up to 10,000 emails annually. Then there are text messages and also candidate surveys to deal with.

Let us take this figure at approximately 3,000 surveys for each recruiter annually and close to 1,000 text messages sent every year as well.

If you talk about the national average for requisitions that are open for each recruiter, then it is comfortably around 40 at any given point in time. We can also take this as a few thousand such requisitions annually.

Automating online communication and recruitment tasks helps directly save time and money. Lowering the overall workload by a minimum of 25-30% means that recruiters save at least 1-2 days per week. This frees them up to focus on other crucial company tasks.

Saving 40 or more working days each year may lead to sizable savings. If hourly fees are taken into account (the amounts paid to recruiters), then it adds up to a mind-boggling amount of  $30,000 for the company, from email automation alone.

How to choose the best AI recruitment tool

For a staffing agency, selecting a quality AI recruitment tool means focusing on a few key criteria. Some of them include the following:

  • The AI sourcing tool should be sophisticated enough to find the qualified candidate’s other tools, or human recruiters might miss them.
  • The AI tool should have customizable DEI options built into the system.
  • It should be available to use anytime and anywhere and in itself can function 24×7 once a process is set
  • It should offer convenient scalability of hiring efforts, from small one-person agencies to the largest international staffing firms.
  • Companies should be able to make data-driven decisions throughout the recruitment process from rich job and industry data.
  • There should be a seamless integration of the tool with existing ATS/CRM solutions and databases of companies.

That said, to understand how exactly the AI recruiting tool can help your company, you can work closely with the AI vendors you’re considering to ensure they have all these strengths.

How to use AI tools in your recruitment services?

There are many ways of leveraging AI-based tools in recruitment services. These include the following:


Screening through integration with ATS/CRM and also for screening newer resumes. Input various parameters for hiring, making the software review applications based on the same.


Your tool can harness chatbots for candidate interaction, answering queries, scheduling assessments/interviews, and building relationships at the initial stage in real time.

Talent sourcing

AI recruiting tools can help a staffing agency source candidates from diverse pools including job boards, job sites, social media, and more. It will automatically look for resumes, profiles, keywords, and other parameters. It will keep learning about identifying and vetting the best-qualified talent from your team’s hiring patterns.

  • Job listings – The market and job data in the best AI solutions can assist recruiters in identifying the skills, experience, and qualifications required for a job.
  • Job advertising – Some AI recruiting tools can target and place your job ads where top talent will see them and respond.
  • Internal decision-making – Whenever a staffing agency or company faces a decision at any recruitment stage, AI helps with vital facts and figures to enable more data-driven decision-making.


AI-based recruitment tools can help every staffing agency streamline and strengthen recruitment services, taking care of talent sourcing, screening, and engagement integrated with existing CRM/ATS solutions. They not only save time and money but also help clients adhere to DEI goals and other hiring objectives while simultaneously contributing to an improved recruitment experience for candidates.

A tool like Arya Quantum can help source candidates across more than 50 channels while integrating easily with almost any ATS/CRM. It offers integration with top job boards along with posting job advertisements strategically on multiple platforms. Staffing agencies can use Arya Quantum for reviewing their pipelines and resumes on a consolidated and user-friendly dashboard while automating engagement via chatbots.


What is the difference between an employment agency and a staffing agency?

An employment agency works for the placement of professionals in long-term job positions. Staffing agencies usually deal with temporary, contract, and part-time positions, along with matching candidates for long-term positions as well. Employment agencies do not hire employees by themselves or pay those that they place in companies in most cases. However, staffing agencies hire employees by themselves, being the official employer for these hires in many cases.

Is hiring and staffing the same thing?

Staffing is a task that is executed throughout all organizational levels, involving several tasks, right from the time of joining an organization to the time of departure. Recruitment or hiring, on the other hand, is only concerned with a candidate’s initial stages, from sourcing to onboarding.

What are the differences between staffing and temp agencies?

A staffing agency may also offer temporary work opportunities, although they offer a broader spectrum including longer work placements, contract positions, direct-hire, temp-to-hire, and more. Temp agencies only offer short-term roles/opportunities for candidates.

What site has the most job postings?

There are several sites that have the most job postings, including LinkedIn, Indeed, Glassdoor, Monster, and many more. A good AI recruiting tool can bring all these job boards into a single list, making them easier to manage.

What are premium job boards?

Premium or paid job boards are those which require fees for posting job advertisements. They may also provide better and more advanced employer networks along with other specialized features.

What is diversity and inclusion hiring tools?

These are recruitment tools that take DEI (diversity, equity, and inclusion) parameters into account while sourcing and screening candidates.

What is an ATS?

An Applicant Tracking System (ATS) is a specialized software solution used for monitoring candidates throughout the entire hiring journey.

Find more compatible candidates with Talent Intelligence.

Discover how Arya goes beyond conventional AI recruiting