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AI Skills Shortage Deepens as Enterprise Demand Grows Faster Than Talent Supply

 

The shortage of skilled professionals in artificial intelligence is becoming a major concern for enterprises, as organizations race to adopt the technology without a matching increase in qualified talent. The latest Harvey Nash Digital Leadership report, released by Nash Squared in May, highlights a sharp rise in demand for AI skills across industries—faster than any previous tech trend tracked in the last 16 years. 

Based on responses from over 2,000 tech executives, the report found that more than half of IT leaders now cite a lack of AI expertise as a key barrier to progress. This marks a steep climb from just 28% a year ago. In fact, AI has jumped from the sixth most difficult skill to hire for to the number one spot in just over a year. Interest in AI adoption continues to soar, with 90% of surveyed organizations either investing in or piloting AI solutions—up significantly from 59% in 2023. Despite this enthusiasm, a majority of companies have not yet seen measurable returns from their AI projects. Many remain stuck in early testing phases, unable to deploy solutions at scale. 

Numerous challenges continue to slow enterprise AI deployment. Besides the scarcity of skilled professionals, companies face obstacles such as inadequate data infrastructure and tight budgets. Without the necessary expertise, organizations struggle to transition from proof-of-concept to full integration. Bev White, CEO of Nash Squared, emphasized that enterprises are navigating uncharted territory. “There’s no manual for scaling AI,” she explained. “Organizations must combine various strategies—formal education, upskilling of tech and non-tech teams, and hands-on experimentation—to build their AI capabilities.” She also stressed the need for operational models that naturally embed AI into daily workflows. 

The report’s findings show that the surge in AI skill demand has outpaced any other technology shift in recent memory. Sectors like manufacturing, education, pharmaceuticals, logistics, and professional services are all feeling the pressure to hire faster than the talent pool allows. Supporting this trend, job market data shows explosive growth in demand for AI roles. 

According to Indeed, postings for generative AI positions nearly tripled year-over-year as of January 2025. Unless companies prioritize upskilling and talent development, the widening AI skills gap could undermine the long-term success of enterprise AI strategies. For now, the challenge of turning AI interest into practical results remains a steep climb.

AI Poses Greater Job Threat Than Automation, Experts Warn

 

Until a few months ago, the whole concern about machines taking over human employment revolved around automation and robots/humanoids. The introduction of ChatGPT and other generative artificial intelligence (AGI) models has triggered a real and more serious threat. 

What started as a conversational tool through prompts is expected to replace human labor in specific industries, beginning with IT/software/tech and media/creative companies, as well as new-age platforms serving the digital economy. However, it is still early days for AI based on large language models (LLMs) to take away employment across the spectrum, although particular hints have emerged.
 
IBM CEO Arvind Krishna told Bloomberg in an interview this week: "I could easily see 30 percent of jobs getting replaced by AI and automation over a five-year period."

With about 26,000 employees, AI might replace nearly 7,800 jobs in the future years. This change, however, will not be rapid, and IBM will initially halt hiring for roles that it believes could be replaced by AI, notably those in back-office or non-customer-facing roles, according to its CEO.

According to Arundhati Bhattacharya, CEO and Chairperson of Salesforce India and a former SBI Chairperson, generative artificial intelligence is a blessing in disguise since it can eliminate much of the grunge or repetitive work in India, freeing up people to do more creative work.

"What generative AI actually will help us do is actually curate things so that they can be made relevant to us. If you ask them the questions in the right manner is where AI can actually help," Bhattacharya told IANS recently.

As per Goldman Sachs, AI might replace the equivalent of 300 million full-time jobs, and Generative AI, which can create content undetectable from human effort, is a "major advancement." Sridhar Vembu, CEO and co-founder of global technology company Zoho, stated that AI posed a severe threat to various programming occupations.

Referring to conversational AI platforms such as ChatGPT and others, Vembu stated that for the past 4-5 years, he has been saying internally that "ChatGPT, GPT4, and other AI being created today will first affect the jobs of many programmers." The only thing Carl Benedikt Frey, future-of-work director at Oxford Martin School, Oxford University, is certain of is that "there is no way of knowing how many jobs will be replaced by generative AI".
 
"What ChatGPT does, for example, is allow more people with average writing skills to produce essays and articles. Journalists will therefore face more competition, which would drive down wages, unless we see a very significant increase in the demand for such work," Frey told BBC News.

Researchers from the University of Pennsylvania and OpenAI, the makers of ChatGPT, have explored the possible effects of large language models (LLMs) like Generative Pretrained Transformers (GPTs) on the US labour market.

According to the data, over 80% of the workforce may see at least 10% of their job duties affected by the introduction of LLMs, while approximately 19% of workers may see at least 50% of their tasks impacted.

"We do not make predictions about the development or adoption timeline of such LLMs. The projected effects span all wage levels, with higher-income jobs potentially facing greater exposure to LLM capabilities and LLM-powered software," the researchers noted.

Significantly, these effects are not limited to industries that have experienced higher recent productivity gains.

"Our analysis suggests that, with access to an LLM, about 15 per cent of all worker tasks could be completed significantly faster at the same level of quality. When incorporating software and tooling built on top of LLMs, this share increases to between 47 and 56 per cent of all tasks," they warned.

According to the report, jobs in agriculture, mining, and manufacturing are the least exposed to generative AI, but jobs in information processing industries, such as IT, are the most exposed to AI models. In accordance to the World Economic Forum, AI will bring three changes to the finance sector: employment reduction, job creation, and increased efficiency.

Banks have already begun to integrate AI into their business structures. Morgan Stanley has begun to structure its wealth management database using OpenAI-powered chatbots. According to Kristian Hammond, head scientist of Natural Sciences, "90% of news will be written by machines" in 15 years.

Some tech companies have begun to hire "prompt managers" to assist with specific office chores via AI chatbots. AI appears to be quickly becoming a monster that will knock on our doors at any time, and experts believe it is critical for the future workforce to develop AI capabilities.