Hiring demand may be moderating across many sectors, but access to specialized skills remains stubbornly constrained. Healthcare, engineering, data, AI, and cybersecurity roles continue to face intense competition, even as broader labor market indicators suggest cooling. Data from the U.S. Bureau of Labor Statistics shows sustained pressure in critical occupations, while Gartner research points to persistent demand for advanced digital and technical capabilities. Compounding the issue, workforce mobility remains limited, shrinking the pool of active candidates and forcing organizations to rethink how they source scarce skills.
This article is based on an edited version of a recorded Talent Leader Council interview with Chip Holmes, Internal Consultant with Randall Reilly. Holmes is a Talent Leader Council contributor and brings more than two decades of experience advising organizations on recruitment process outsourcing and talent strategy. The conversation is part of RPOA’s ongoing Talent Leader Council interview series, which examines emerging workforce challenges through the lens of industry practitioners.
Even as some roles disappear, others are being created faster than the market can supply qualified talent. Automation and AI are reshaping work, eliminating routine tasks while generating demand for new, highly specialized capabilities. At the same time, investment capital continues to flow into technology-intensive sectors, further accelerating demand.
RPOA: What factors are driving the disconnect between cooling hiring demand and persistent shortages in specialized skills?
Holmes: The reality is we are creating new roles at the same time other roles are going away. Routine work is being automated, but new skills are emerging that simply do not have enough people behind them yet. Add to that the capital being invested in areas like AI, engineering, and healthcare, and you get continued job creation where talent is already scarce.
“It’s normal to see cooling when certain jobs are no longer needed, but at the same time we are ramping up demand for roles that don’t have an established talent supply.”
Chip Holmes, Internal Consultant, Randall Reilly
For talent leaders, this reinforces that scarcity is not a short-term market imbalance. It is a structural issue tied to how work itself is evolving.
Skills-first hiring is widely endorsed in principle, but far less mature in execution. Many organizations say they prioritize skills over credentials, yet their systems and processes still screen out capable candidates.
RPOA: How is skills-first hiring changing the way organizations think about talent acquisition?
Holmes: You need the person who can do the job, not the person whose resume suggests they might. The problem is that everything has to catch up. Technology, training, and mindset all need to align. I’ve seen organizations that believe in skills-based hiring but use applicant tracking systems that automatically remove candidates without degrees.
Holmes argues that skills-first hiring should emphasize learning aptitude as much as current capability, particularly for emerging roles where no one can have deep experience yet.
“For many of the skills we need today, nobody really has them yet. The question becomes whether someone has the aptitude to learn and adapt.”
Chip Holmes, Internal Consultant, Randall Reilly
This has clear implications for talent governance. Without intentional redesign, skills-first hiring remains aspirational rather than operational.
Emerging roles expose the limits of traditional recruiting. Keyword searches and historical job titles break down when technologies are newer than the experience requirements attached to them.
RPOA: What challenges do organizations face when trying to fill newly created or highly specialized roles?
Holmes: Traditional recruiting does not work. There is no search that finds someone with three years of experience in a technology that has existed for 12 months. We have to relearn recruitment by focusing on what we actually need from a person, not whether they match a list of keywords.
This shift requires recruiters to evaluate adjacent skills, problem-solving ability, and adaptability. It also increases the importance of training and internal upskilling as part of workforce planning, rather than treating hiring as the only solution.
With most workers choosing to stay put, the active labor market has shrunk dramatically. Holmes describes a fundamental shift in recruiting dynamics.
RPOA: How are leading organizations engaging passive candidates in today’s market?
Holmes: We have moved from speed dating to long-term relationships. Talent communities are not just databases. They are curated groups where people receive value over time, even if they are not ready to move today.
Holmes points to talent communities, referrals, and brand-driven engagement as critical levers. Organizations that invest in these strategies are better positioned when a candidate’s situation eventually changes.
“The goal is to already have a relationship when the moment is right, not to start from zero.”
Chip Holmes, Internal Consultant, Randall Reilly
This approach demands sustained effort and infrastructure, which many internal teams struggle to maintain alongside other responsibilities.
While organizations can pursue skills-first and passive talent strategies internally, Holmes argues that external partners play a growing role in execution.
RPOA: What value do external recruiting partners bring in accessing scarce and underrepresented talent pools?
Holmes: External partners can focus where internal teams cannot. We build targeted outreach strategies, develop and manage talent communities, and bring industry-specific insights to the table. Our role is to make life easier for internal leaders by taking complexity off their plate.
From targeting nontraditional pipelines to applying industry intelligence, RPO models offer scale and specialization. This is particularly relevant when organizations need to sustain engagement with passive talent over long periods or adapt quickly to new skill requirements.
Specialized skill shortages persist because they are rooted in structural shifts, not temporary market cycles. As work evolves, organizations face a growing gap between the skills they need and the talent available. Skills-first hiring, passive talent engagement, and internal upskilling are necessary responses, but they require operational maturity to succeed.
The insights from Chip Holmes reinforce why many organizations are turning to external recruiting partners to bridge this gap. By combining domain expertise, technology, and sustained focus, RPO models help leaders move from intention to execution. As RPOA continues to convene industry perspectives through the Talent Leader Council, these conversations play a critical role in advancing evidence-based understanding of how talent strategy must evolve in an era of persistent skill scarcity.