As Part 1 established, employers are facing a labor market in which job postings are recovering while the available workforce remains constrained. That imbalance is increasing competition for candidates and pushing RPO providers to focus on conversion, speed, and measurable outcomes. The pressure is intensified by a second shift: candidates are using artificial intelligence to navigate nearly every stage of the job search.
Speaking at the 2026 RPOA Annual Conference, Tim Gates, Director of RPO and BPO Enterprise Accounts at Indeed, described how AI is changing candidate behavior and what that means for recruitment teams. His message was not that technology can replace recruiters. Rather, providers need to understand how candidates are using these tools, adjust their processes, and apply human judgment where it has the greatest impact.
Gates said roughly two out of three candidates use AI in some part of the hiring process, while more than 80% of hiring managers see candidate AI use as a concern. Candidates may use AI to search for relevant roles, tailor resumes, generate application materials, prepare for interviews, develop portfolios, or navigate assessments. Some tools can also help candidates explore career paths based on transferable skills rather than relying only on previous job titles.
Gates illustrated the change through Indeed’s Career Scout tool, which began rolling out the previous September and reached full adoption in May 2026. Previously, a candidate might provide five or six basic pieces of information, upload a resume, and search by job title or location. Career Scout asks for approximately 50 to 60 pieces of information, including details that help identify skills developed through past work. A person who worked as a barista, for example, may also have customer-service, project-management, or deadline-management skills that could transfer to other roles.
Gates said this richer profile allows the tool to recommend opportunities based on a candidate’s skills and potential career direction. From May through the end of September, Career Scout users found jobs seven times faster and were 38% more likely to receive an offer than non-users, according to the data he shared. He cautioned that the measurement period was still relatively short. He also said 75% of users reported a more positive perception of Indeed after using the tool.
The application process is changing alongside job discovery. Rather than sending one general resume to every employer, candidates can tailor resumes to individual openings and submit applications through stored profiles. They can also use AI to conduct mock interviews and track applications. As a result, candidates may arrive better prepared, but their applications may also look more alike.
That more active job search changes the expectations placed on employers and RPO teams. Gates said candidates are tracking where they apply and how quickly employers respond. If they hear nothing within roughly 12 hours, they may assume the opportunity has stalled and move on to another application.
A quick acknowledgment can help maintain engagement, even when a full decision is not yet available. Gates recommended communicating clearly that a candidate is being considered and providing a realistic timeframe for the next update, such as 24 or 48 hours. Technology can support that initial communication, while recruiters provide the personal follow-through.
Job information also plays a role in whether candidates stay interested. Generic descriptions are less likely to distinguish an opportunity. Gates encouraged employers to make details such as compensation, schedule flexibility, required skills, benefits, and training or development opportunities clear. Candidates may use AI to find and compare jobs, but they still investigate an employer’s value proposition and reputation when deciding whether to proceed.
For RPO providers, the implication is twofold: reduce friction in the application and communication process, while making sure the opportunity itself gives candidates a reason to engage. Speed without relevant information is not enough; neither is a compelling job description if the process leaves candidates waiting.
As AI makes it easier to create polished resumes and application materials, Gates argued that recruitment teams need to place greater emphasis on verifying skills and credentials. Structured, experience-based interviews can help assess how candidates approach the work rather than relying exclusively on resume descriptions. Assessments, work samples, and credential checks may also help, depending on the role and the extent to which a skill can be objectively verified.
Gates drew a distinction between what technology can do efficiently and where people remain critical. AI can support high-volume activities such as sourcing, screening, and scheduling. Recruiters still add value through conversations, contextual evaluation, candidate engagement, and decisions about fit. The goal is not to remove the human element, but to use it where it has the greatest effect.
Gates also connected these changes to the sectors where many RPO providers operate. In healthcare, job postings and wage growth had moderated, but openings remained high relative to hires. He emphasized proactive pipeline development, particularly given the sector’s exposure to changes in immigration and labor supply.
Skilled trades face a structural supply challenge. Gates said that for every five workers leaving the segment, only two are entering. Demand for electricians, HVAC technicians, and installation and maintenance roles is being supported by infrastructure projects and data-center construction. Apprenticeships, training programs, and other ways to identify transferable skills can help employers build a stronger pipeline.
Manufacturing continues to need workers, with Gates citing a projection that as many as 1.9 million jobs could go unfilled by 2033. He pointed to same-day offers, on-site hiring events, flexible shifts, and partnerships with technical and vocational schools as ways to improve delivery. In warehouse and logistics hiring, he cited approximately 270,000 seasonal hires in the previous peak season and a forecast of 450,000 to 460,000 opportunities for the upcoming season. Because many workers hold multiple jobs, pay, hours, and schedule flexibility can influence whether they choose one employer over another.
These examples reinforce the need to tailor recruitment strategies to the labor pool and the work itself. A single process cannot address every market’s supply constraints or candidate priorities.
Gates closed by returning to the outcome clients ultimately expect: hires. He encouraged RPO teams to source where talent is available, verify skills, make pay information visible, and use AI to increase efficiency without surrendering human judgment. He also stressed the importance of bringing data into regular client reviews so that performance discussions connect delivery activity to results.
He left providers with practical questions: Where are requisitions stalling between opening and offer? Does the sourcing strategy reflect the realities of each market? How are skills being verified when resumes look similar? Are job postings structured so AI tools can match candidates effectively? And which steps should AI own, versus those that require a recruiter?
Together, the two shifts Gates described point to a more demanding RPO environment. Candidates are better equipped to search and apply, employers are competing for a constrained supply of talent, and clients expect providers to demonstrate measurable value. Technology can help manage scale, but better hiring outcomes still depend on relevant opportunities, timely communication, credible assessment, and human decisions.