How ATS Systems Really Work: A Complete Guide for 2025

What Are ATS Systems?

Applicant Tracking Systems (ATS) are software applications that help companies manage their recruitment process. These systems automatically scan, parse, and rank resumes based on specific criteria set by employers. In 2025, over 99% of Fortune 500 companies and 70% of all employers use some form of ATS to filter job applications before they ever reach human eyes.

Understanding how these systems work is no longer optional—it's essential for anyone serious about landing their dream job. The good news is that once you understand the mechanics behind ATS, optimizing your resume becomes straightforward and manageable.

How ATS Systems Filter Resumes

ATS systems use several sophisticated methods to filter and rank resumes:

Keyword Matching: The system searches for specific keywords and phrases related to the job posting. This includes job titles, skills, certifications, software proficiency, and industry-specific terminology. The more relevant keywords your resume contains, the higher it ranks in the system.

Format Recognition: ATS systems parse your resume to extract information into structured data fields. Simple, clean formats with standard fonts and clear section headings are easier for ATS to parse accurately. Complex formatting, graphics, tables, and unusual fonts can confuse the system, causing it to misread or skip important information.

Section Identification: The system looks for standard section headings like "Work Experience," "Education," "Skills," and "Certifications" to categorize your information correctly. Using non-standard headings like "My Journey" or "What I've Done" can prevent the ATS from properly categorizing your experience.

Experience Matching: ATS analyzes years of experience, job titles, company names, and employment dates to determine if you meet the basic qualifications. It can also identify gaps in employment and calculate total years of relevant experience.

Optimizing Your Resume for ATS

To improve your ATS compatibility and increase your chances of getting past the initial screening:

1. Use Standard Section Headings: Stick with conventional headings like "Work Experience," "Professional Experience," "Education," "Skills," and "Certifications." Avoid creative alternatives that might confuse the ATS.
2. Include Relevant Keywords: Carefully read the job posting and identify key terms, skills, and qualifications. Incorporate these naturally throughout your resume, especially in your skills section and job descriptions.
3. Use a Simple, Clean Format: Choose a standard font like Arial, Calibri, or Times New Roman in 10-12 point size. Avoid graphics, images, charts, tables, text boxes, and headers/footers that can confuse ATS parsers.
4. Save in the Right Format: Most ATS systems prefer .docx or .pdf files. However, some older systems struggle with PDFs, so .docx is often the safest choice unless the job posting specifies otherwise.

Common ATS Mistakes to Avoid

Many qualified candidates get filtered out due to these critical errors:

• Using Creative Fonts or Formatting: Decorative fonts, multiple columns, and complex layouts may look impressive to humans but are nightmares for ATS systems to parse.
• Including Images or Graphics: Photos, logos, charts, and infographics cannot be read by ATS and may cause parsing errors that result in missing information.
• Using Non-Standard Section Headings: Creative headings like "My Superpowers" instead of "Skills" prevent the ATS from categorizing your information correctly.
• Keyword Stuffing: While keywords are important, unnaturally cramming them into your resume can trigger spam filters and make your resume unreadable to humans.

Testing Your Resume

Before submitting your resume, test its ATS compatibility:

• Plain Text Test: Copy and paste your resume into a plain text editor (like Notepad). If the formatting looks jumbled or information is missing, the ATS will likely have similar problems.
• Online ATS Checkers: Use free online tools that simulate ATS parsing to identify potential issues with your resume format and content.
• Professional Optimization: Consider using Resume Alchemy's AI-powered optimization to ensure your resume is fully ATS-compatible while maintaining professional appeal for human readers.