Understanding ATS: The Complete Guide for Job Seekers

Up to 75% of resumes never reach human eyes. They're rejected by Applicant Tracking Systems (ATS) before a recruiter even knows you applied. Understanding how ATS works isn't optional in 2025—it's essential for job search success. Here's your complete guide to navigating these gatekeeping systems.

What Is an Applicant Tracking System?

An Applicant Tracking System is software that automates the hiring process by collecting, scanning, sorting, and ranking resumes based on specific criteria. Think of it as a filter that sits between you and the hiring manager.

Who uses ATS?

• 98% of Fortune 500 companies
• 66% of large companies
• 35% of small to medium businesses
• Increasingly common in companies of all sizes

If you're applying online through a company website or job board, there's a high probability an ATS is processing your application.

How ATS Systems Actually Work

Understanding the ATS process helps you optimize for success:

Step 1: Receipt and Parsing

When you submit your resume, the ATS attempts to "parse" it—extract information and organize it into a database. It looks for:

• Contact information
• Work experience (job titles, companies, dates)
• Education (degrees, schools, graduation dates)
• Skills and certifications

Step 2: Keyword Scanning

The ATS searches your resume for specific keywords related to the job requirements. It's looking for:

• Technical skills and tools
• Industry-specific terminology
• Required qualifications
• Certifications and credentials
• Soft skills mentioned in job description

Step 3: Scoring and Ranking

Based on keyword matches and other criteria, the ATS assigns your resume a score. Resumes are then ranked from most to least qualified. Only top-scoring resumes move forward to human review.

Step 4: Human Review (If You Pass)

Recruiters typically only review the top 25-30% of applications that passed ATS screening. This is why ATS optimization is critical—you need to make it into that top tier.

Common ATS Systems Used Today

Different companies use different ATS platforms, each with slightly different capabilities:

• Workday: Used by large enterprises
• Taleo (Oracle): Common in Fortune 500 companies
• Greenhouse: Popular with tech companies and startups
• Lever: Used by many modern, growing companies
• iCIMS: Widely adopted across industries
• Jobvite: Common in mid-sized companies

Good news: While each system has nuances, following universal best practices works across all platforms.

What ATS Systems Can't Read

ATS technology has limitations. These elements often cause parsing errors:

Formatting that confuses ATS:

• Tables: Content gets scrambled or lost
• Text boxes: Often completely invisible to ATS
• Headers and footers: Information here may not be parsed
• Multiple columns: Reads left-to-right, creating jumbled order
• Images and graphics: Cannot be read or interpreted
• Charts and graphs: Visual data doesn't translate
• Special characters: Symbols like ❖, ►, ✓ cause errors
• Unusual fonts: May not render correctly

File Formats: What Works Best

File format can make or break your ATS success:

Most ATS-friendly formats:

• .docx (Microsoft Word): Universally compatible, best choice when no format specified
• .PDF: Works with modern ATS IF it's text-based (not scanned image)
• .txt: Highly compatible but loses all formatting

Formats to avoid:

• .pages: Mac-specific, poor ATS compatibility
• .jpg or .png: Image files cannot be parsed
• Scanned PDFs: Treated as images, text not extractable
• .odt or other uncommon formats: Many ATS systems can't process them

Pro tip: Always follow the job posting's file format instructions. When no format is specified, .docx is your safest bet.

The Role of Keywords in ATS

Keywords are the heart of ATS optimization. The system searches for specific terms to determine if you're qualified.

Types of keywords ATS looks for:

• Hard skills: Technical abilities, software, tools, methodologies
• Soft skills: Leadership, communication, problem-solving (when mentioned in job description)
• Certifications: Professional credentials and licenses
• Education: Degree types, fields of study, institutions
• Industry terms: Jargon and terminology specific to the field
• Job titles: Current and past role titles

How to identify critical keywords:

• Read the entire job description carefully
• Note terms that appear multiple times
• Pay special attention to "Required" and "Preferred" sections
• Look at similar job postings to identify common terms
• Include both acronyms and full terms (e.g., "SEO" and "Search Engine Optimization")

Standard Section Headings for ATS

ATS systems are programmed to recognize standard section headers. Creative headings confuse the software.

Use these standard headings:

• "Work Experience" or "Professional Experience" (not "My Journey" or "Career Story")
• "Education" (not "Academic Background" or "Where I Studied")
• "Skills" (not "Core Competencies" or "What I Bring")
• "Certifications" (not "Credentials" or "Badges")
• "Professional Summary" or "Summary" (not "About Me" or "Profile")

Save your creativity for after you pass the ATS screening. Clear, standard headers ensure your information is properly categorized.

Common ATS Myths Debunked

Let's clear up misconceptions about ATS:

• Myth: "ATS automatically rejects resumes with employment gaps"
  Truth: ATS doesn't make rejection decisions—it ranks resumes. Humans decide about gaps
• Myth: "You should include white text with keywords to trick the ATS"
  Truth: Modern ATS detects this tactic and may flag or reject your resume
• Myth: "All PDFs are ATS-unfriendly"
  Truth: Text-based PDFs work fine with modern ATS. Scanned/image PDFs do not
• Myth: "You need to match 100% of keywords to pass"
  Truth: Matching 70-80% of key requirements is usually sufficient
• Myth: "ATS rejects resumes with color"
  Truth: Subtle color accents are fine as long as there's sufficient contrast
• Myth: "Longer resumes score better because they contain more keywords"
  Truth: Relevance matters more than length. Quality over quantity

Testing Your Resume for ATS Compatibility

Before submitting, test how well your resume will parse:

Plain text test:

• Copy your entire resume
• Paste into Notepad (Windows) or TextEdit (Mac)
• If the information is scrambled or unreadable, an ATS will have similar problems
• Fix formatting issues and test again

PDF text test:

• Open your PDF resume
• Try to select and copy all text
• If you can't select the text, the ATS can't read it either
• Ensure you're creating text-based PDFs, not image-based ones

Online ATS simulators:

• Tools like Jobscan, Resume Worded, or SkillSyncer
• Upload your resume and a job description
• Get a compatibility score and suggested improvements
• See which keywords you're missing

The Human Element: Beyond ATS

Remember: ATS is just the first filter. Your goal isn't just to pass the ATS—it's to impress the human who reviews your resume after.

Balance ATS optimization with human appeal:

• Include keywords naturally, not through forced keyword stuffing
• Write compelling achievement statements, not just keyword lists
• Maintain readability and professional appearance
• Use quantifiable results that impress humans while containing relevant keywords
• Tell a coherent career story, not just a collection of buzzwords

Strategies When You Don't Meet All Requirements

What if you don't have all the keywords they're looking for?

• Emphasize transferable skills: Show how your experience relates even if titles differ
• Include related terms: If they want "project management" and you have "program coordination," include both
• Highlight learning ability: Show examples of quickly mastering new skills
• Focus on what you do have: Make your matching qualifications very prominent
• Consider whether to apply: If you only match 40-50% of requirements, your chances are slim

Alternative Application Strategies

Sometimes you can bypass or supplement ATS submissions:

• Network your way in: Referrals often skip or fast-track through ATS
• Direct email to hiring manager: If you can identify them on LinkedIn
• Career fairs and recruiting events: Face-to-face interactions
• Company recruitment events: Direct access to recruiters
• LinkedIn applications: Sometimes processed differently than company website

However, even with these strategies, having an ATS-optimized resume is still important.

Perfect ATS Optimization, Automatically

Optimizing for ATS while keeping your resume appealing to humans is challenging. ResumeHero's AI automatically handles all ATS best practices—proper formatting, standard headings, optimal file formats, and strategic keyword integration—while ensuring your resume remains visually professional and compelling.

Our intelligent system analyzes job descriptions, identifies critical keywords, and suggests natural placements throughout your resume. No more guessing whether your resume will pass ATS screening. Every resume built with ResumeHero is automatically optimized for both software and human readers.

Stop worrying about ATS compatibility. Create an optimized resume in minutes, completely free.