I've considered this an issue for a long time. What's even more annoying is when you apply and don't even get the courtesy of an acknowledgement. I've thought for a while that some enterprising job application software startup could add a 'be polite' function which would automatically reply back to someone after X days if the employer decided not to follow up.

But as someone else mentioned, we're (in the US) such a 'lawsuit happy' place that many companies are likely fearful of committing anything in writing which would come back to haunt them. Even truthful, as in "based on your application, you're not qualified to work here", might offend someone.

Personally, I think that excuse is a bit overblown, and I suspect it's more a factor of people being lazy or overworked when they don't reply.

What does a company get out of spending time replying to applicants they've turned down? A reputation of being professional, perhaps even 'outstanding'. When getting totally ignored becomes the norm, even getting a polite 'no thanks' acknowledgement might be something to make you think twice about that company and how you refer to them in the future.

Also, many companies could do well to post on a blog the types of candidates they're looking for, explain the process, and perhaps even give genericized examples of things to avoid in an application, based on the previous applicants. This would help get them a better prepared applicant, making the process a bit easier for them.