Penn Foster’s new The Career Economy: 2026 report finds that economic uncertainty, artificial intelligence and changing employer expectations are reshaping how Americans define career success. The research points to growing demand for faster, affordable skills-based pathways as employers increasingly prioritize demonstrated capabilities over traditional credentials and AI changes the expectations attached to entry-level work.
The definition of career success is changing as workers face economic uncertainty, rising costs and an increasingly AI-driven labor market, according to a new report from Penn Foster.
The online education and workforce development provider’s The Career Economy: 2026 combines original consumer research with labor market data to examine how workers and employers are responding to changes in employment, skills and career development.
One of the report’s central findings is a decline in career confidence. One in four Americans surveyed said they feel less confident in their ability to build a stable and financially successful career than they did three years ago, with the cost of living identified as the leading barrier to career growth.
At the same time, workers appear to be looking for shorter and more affordable routes into new careers. Penn Foster found that 70% of Americans would spend no more than one year training for a new career, while the same proportion would spend no more than $2,500 out of pocket.
For HR and workforce development leaders, those findings point to growing pressure to rethink how organizations build talent pipelines. Traditional four-year degrees remain important for many professions, but employers increasingly need ways to identify and develop job-ready capabilities more quickly.
The report says 70% of employers now use skills-based hiring practices, reflecting a broader movement away from relying exclusively on degrees, GPAs and other traditional credentials.
Skills-based hiring is also changing the relationship between recruiting and learning. When employers evaluate candidates based on demonstrated capabilities, training and upskilling programs can become more directly connected to specific job requirements.
That shift is particularly relevant as artificial intelligence changes the composition of entry-level work.
According to Penn Foster’s research, more than 40% of employers report that AI has already increased analytical expectations for entry-level roles. The report also points to expectations that nearly 40% of core workforce skills will change by 2030.
The implication for employers is that entry-level hiring may increasingly involve a combination of foundational knowledge, analytical ability and AI fluency. Workers entering the labor market may need to demonstrate that they can use AI-enabled tools while also applying judgment to the results those systems produce.
This could place additional pressure on organizations to connect recruiting, learning and workforce planning. Hiring employees with emerging skills is one approach, but companies may also need internal mobility and reskilling programs that allow existing workers to transition as job requirements change.
Penn Foster’s findings suggest workers are already prioritizing practical outcomes. Career pathways that can demonstrate a clear connection between training and employment may become more attractive as individuals weigh the time and financial cost of additional education.
Healthcare, skilled trades and veterinary medicine are identified in the report as areas where workers continue to see opportunities for stability and advancement. These sectors also illustrate why workforce development increasingly needs to combine formal education with practical skills.
For employers, the challenge extends beyond filling immediate vacancies. Sustainable talent strategies require organizations to create pathways through which employees can develop capabilities for future roles.
That makes education and workforce development providers increasingly relevant to enterprise HR technology strategies. Learning platforms, skills assessment tools, talent marketplaces and internal mobility systems can help organizations identify capability gaps and connect employees with development opportunities.
Penn Foster says it works with more than 150 employers and workforce organizations, 171 academic institutions and more than 7,000 high schools. In 2025, the organization reported that 93,000 learners completed its programs.
Those figures are company-reported and demonstrate the scale of its education and workforce development network, rather than an independent measure of program outcomes.
The broader trend highlighted by the report is a move toward more outcome-oriented workforce development. Employees want career pathways that are affordable and efficient, while employers need workers whose skills align with changing operational requirements.
AI is accelerating that transition. As technology changes tasks and raises expectations for analytical and digital capabilities, the half-life of some skills may become shorter, making continuous learning more important.
For HR leaders, the strategic question is therefore not simply how to recruit workers with the right skills today. It is how to create systems that allow employees to acquire new capabilities as jobs evolve.
The Career Economy: 2026 findings reinforce the growing connection between skills-based hiring, workforce development and internal mobility. In an increasingly volatile labor market, organizations that can connect training with measurable career pathways may have an advantage in building and retaining adaptable talent.
Market Landscape
Skills-based hiring is becoming an increasingly important part of workforce strategy as employers respond to changing job requirements and AI-driven shifts in work. At the same time, workers are showing stronger interest in shorter, lower-cost pathways that connect education directly to employment outcomes.
For HR technology providers, this creates opportunities across skills intelligence, learning and development, talent marketplaces, internal mobility and workforce planning. AI adds another layer by accelerating changes in job requirements and increasing the need for continuous skills development.
The emerging model is less focused on a one-time educational credential and more focused on whether workers can demonstrate the capabilities required for current and future roles.
Top Insights
- Penn Foster reports that 70% of employers now use skills-based hiring, highlighting the growing importance of demonstrated capabilities alongside traditional credentials.
- Seventy percent of Americans surveyed would spend no more than one year training for a new career, reflecting demand for faster pathways.
- More than 40% of employers say AI has already increased analytical expectations for entry-level positions.
- Nearly 40% of core workforce skills are expected to change by 2030, increasing pressure for continuous learning and reskilling.
- Healthcare, skilled trades and veterinary medicine remain promising career pathways amid broader labor-market uncertainty.
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