The biggest hiring challenges facing talent teams this year are increasing diversity and a shortage of qualified candidates, according to a new Future of Talent Acquisition and Recruitment 2025 study from Findem and Recruiter.com. The study involving 930 recruiting professionals also reveals a growing frustration with inefficient tech use, yet a clear opportunity for AI and automation to enhance sourcing, candidate management and hiring efficiency.
Inclusive Hiring No. 1 Challenge for TA. Tech to the Rescue?
Candidate pool diversification continues to be a priority for most employers, but it’s proving to be a difficult endeavor for recruiters who are largely responsible for turning the mission into a reality, especially as corporations navigate a complicated DEI landscape. The study found meeting inclusive hiring goals is their biggest obstacle in 2025, cited by 44%, with a lack of qualified candidates a close second with 38%. Half said they will leverage recruitment technologies to help diversify their talent pools this year, and nearly half will apply tech to reduce human bias in hiring decisions.
“Leading companies understand that hiring more inclusively brings in higher-quality candidates, but it’s a tough balancing act—bias can creep in, and AI can be unreliable if left to its own devices,” said Tina Shah Paikeday, Innovation Accelerator General Manager at Findem. “But when AI is used the right way—to support decisions—it can be a total game-changer, helping recruiting teams build more inclusive pipelines to identify the best talent in the market.”
Recruiters Overwhelmed by Inbound, Struggling to Find Top Talent in a Haystack
Talent teams aren’t just struggling with inclusive hiring, they’re also drowning in a flood of unqualified applicants. Three out of four reported a spike in applications per open role, and 24% cited an overwhelming volume of applications and low-performing hiring channels as obstacles to their success.
“Talent teams are facing an unprecedented influx of inbound, a challenge intensified by the rise of job application bots. Sifting through hundreds of applications per open role is impractical and a major drain on recruitment resources,” said Findem CEO Hari Kolam. “Success in the TA world hinges on productivity and efficiency and, without the right tools to manage the swell of unqualified inbound, both take a hit. That’s why 71% of recruiters told us they plan to prioritize technology for managing active applicants in 2025.”
Tech Investment Priorities Shift—CRM Takes Center Stage
Only one in three talent leaders plans on decreasing their spend on talent acquisition technology this year, compared with approximately 60% who anticipate their spend to remain about the same or slightly increase. Where they intend on putting their dollars suggests a shift from passive sourcing to sourcing from the talent they already know. Nearly half – 42% – plan to increase spending on CRM, while 21% expect to decrease the amount spent on candidate sourcing solutions. Recruitment marketing and talent analytics are also expected to see budget boosts in 2025.
“The latest findings show TA leaders are investing in tools such as CRM that help them be more strategic and forward-looking—a smart move in the face of potential hiring freezes and economic uncertainty,” said Findem Chief Transformation Officer Brett Coin. “Staying competitive will require a multichannel recruiting strategy where AI and automation handle the heavy lifting of sourcing across all hiring channels, and recruiters better use their time building real connections with candidates.”
Legacy Recruiting Tech Still Dominates, Yet ROI Is Questionable
Recruiters remain heavily dependent on legacy recruiting technologies, yet many are feeling pinched by the high costs and disillusioned by low returns. The study reveals that 68% use LinkedIn Recruiter as their primary tool for applicant tracking and outreach – close to double the percentage of the closest-ranking alternative. What’s more, although one in five spend 61-80% of their tech budget on LinkedIn Recruiter, 84% report the technology was responsible for fewer than 40% of their hires.
With costs rising and platforms covering more ground than before, many organizations are consolidating their tech stacks, and most are now using five or fewer recruiting tools.
Recruiters Confident in Their Abilities, But Not in Their Tech and Analytics
While 58% of recruiters believe their teams are above average in effectiveness, only 8% consider their organizations veryeffective. The top barriers?
- Ineffective use of technology, analytics and market insights (65%)
- Mismatch between candidate skills and business requirements (44%)
- Inefficient recruiting processes and lack of diverse candidates (both 30%)
Despite these challenges, very few blame unrealistic expectations or inexperienced teams, suggesting that the real issue lies in how teams are leveraging (or underleveraging) their tools.
Metrics Heavily Skewed Toward Volume vs. Performance
Talent teams continue to prioritize volume over performance metrics, raising concerns about long-term hiring quality and alignment with business goals. Sixty four percent ranked metrics, such as offer acceptance rate, time to source and number of open positions as most important, while 26% prioritized performance metrics such as candidate response rate, source of hire and candidate experience. Despite growing attention, internal mobility ranked dead last.
Despite Job Uncertainty, Optimism Around Hiring in 2025
Almost 80% of recruiters admitted that they felt job insecurity in the past year, but most remain bullish about hiring demand and job growth. Forty five percent expect to make more hires in 2025 than 2024, and just 12% anticipate making fewer.
They also plan to expand their own teams. Nearly one-third plan to expand their talent team’s headcount and more than one-third plan to hire additional recruiters in the next 12 months. Interestingly, only 7% expect their recruiting teams to shrink, a strong indicator that they don’t expect AI and automation to replace recruiting jobs in the near term.
For a deeper dive into the latest trends and strategies, access the full study here.
Methodology
The Future of Talent Acquisition and Recruitment 2025 survey was fielded from Aug. 15 to Sept. 30, 2024. The survey was completed by 930 respondents who are HR or recruiting professionals in North American companies with at least 200 employees and who are involved in talent acquisition budget decisions. The respondents work for companies spanning various industries, and that range from late-stage startups to multinationals.
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