Abstract: The research examines the effect of data-driven hiring through Artificial Intelligence (AI) on candidate experience and employee retention in medium- to large-sized organizations. While organizations become more digital in their drive, the use of AI in hiring has become one of the primary ways to enhance recruitment success and workforce stability. The study seeks to evaluate the impact of AI-driven hiring practices on how job applicants participate throughout the recruitment process and how these practices correlate with long-term job retention in the company.

The study findings indicate widespread AI adoption in companies under investigation, as respondents confirmed that AI-driven recruitment assisted in finding appropriate candidates and eliminating human prejudice. The majority of respondents concurred that recruitment practices were in line with real job duties and organizational culture, contributing to improved job satisfaction and employee retention. Statistical testing proved the relationship between AI-based hiring, engagement of candidates, and retention of employees to be very positive. Engagement was also highly connected to seeing that evaluated skills could be applied in everyday jobs.

The research indicates that the candidates who undergo transparent, fair, and meaningful recruitment are more likely to stay with the organization. These findings confirm the rejection of the null hypotheses and establish that AI-based recruitment has a strong positive effect on engagement and retention. The results imply that organizations need to embrace ethically sound and strategically aligned AI-based recruitment strategies to attract, engage, and retain best talent in an increasingly competitive labour market.

Keywords: Data-Driven Recruitment, Candidate Engagement, Employee Retention Rate, Predictive analytics, Compliance and ethical Consideration.

Downloads: | DOI: 10.17148/IARJSET.2026.13231