The US labor market reached a tipping point this year. For the first time since the federal government began tracking job openings in 2000, there are more openings than there are unemployed people looking to fill them. Presumably, all job seekers need to do now is send out their resume, and voila, an offer should appear.
The reality is a little less rosey. In the US, it still takes the average job seeker about nine weeks to find a job. It’s not easy for employers, either. A study by the Society for Human Resource Management found that it costs employers $4,129 and takes, on average, 42 days to fill a position. Research (pdf) by the jobs site Glassdoor found that in the US, the interview process alone took 13 days on average in 2009, but rose to 23 days in 2015. (The process takes even longer in the UK, France, Germany, and Australia, per Glassdoor’s report.)
It appears the hiring marketplace is broken on both sides. ZipRecruiter, a startup that uses artificial intelligence to match potential employees with employers, raised $156 million today (Oct. 4) to try to fix it.
ZipRecruiter’s goal is to play professional matchmaker. Instead of handing over hundreds of qualified candidates to a hiring manager, the site uses an algorithm to recommend fewer qualified candidates, more quickly.
“When I started this business, I used to tell people, ‘We sell haystacks, we don’t sell needles,'” says Ian Siegel, ZipRecruiter’s CEO. “Now we’re in the needle business.” On the worker side, Siegel says the majority of job candidates on ZipRecruiter’s site start with a blank search field. In other words, they upload their resumes to the platform and let the technology tell them what jobs might be a good fit.
Until this year, the company had gone four years without taking outside funding. With the latest round, led by Wellington Management Company and venture investment firm IVP, ZipRecruiter is valued at $1.5 billion, putting it in the pantheon of private companies to reach unicorn status, i.e. surpassing $1 billion in valuation.
Harj Taggar, the CEO of Triplebyte, a ZipRecruiter competitor that’s specifically geared toward software engineers, worries that exclusively using an algorithm to find job candidates based on their background alone might disadvantage workers with atypical career journeys.
But regardless of the means used, far too many people apply to jobs for technology not to be brought into the hiring process. Already, the average hiring manager only spends six seconds (pdf) reading candidates’ resumes. And resumes themselves are poor proxies for people’s true identities.
Instead, it seems inevitable that technology like ZipRecruiter’s will become the go-to means of matching potential employees with jobs they may or may not seek out. Already 430 million job seekers have applied to jobs on the platform. As more candidates get matched to employers, the algorithm will only get better.