Is there a way to add an extra intermediate step in CSP which makes candidate status as Inactive

Summary:

Wanted to add new state which should make candidate status as Inactive.

Content (please ensure you mask any confidential information):

When a requisition is cancelled, Application will become Inactive(Rejected by Employer) and system will send a notification to Applicants saying that the application is "Rejected by Employer" which is wrong message for some applicants where they even not moved to first step of selection process.
Other than this applicants should receive a notification saying that position is cancelled.

In order to achieve this, we tried with some workaround to add some inactive state so that before recruiter cancel the requisition they will move applicants status to new inactive state which is created.