External recruiting is getting disrupted from within.

According to new research from Gartner and LinkedIn Talent Solutions, Fortune 500 companies filled 61% of open roles with internal candidates in 2025—up from 38% in 2023 and just 28% in 2020.

The shift is massive, and it's accelerating. Internal mobility programs—powered by AI matching, career pathing tools, and talent marketplaces—are replacing external recruiting as the primary way companies fill critical roles.

For recruiters, the message is clear: adapt to internal mobility or become irrelevant.

The Numbers: Internal Hiring Is Exploding

Gartner's 2025 Talent Mobility Report analyzed hiring data from 287 Fortune 500 companies. The results:

Percentage of roles filled internally:

• 2020: 28%
• 2021: 32%
• 2022: 35%
• 2023: 38%
• 2024: 49%
• 2025: 61%

That's a 118% increase in internal fill rate in just 5 years.

Even more striking: 83% of Fortune 500 companies now have formal internal mobility programs (up from 41% in 2022).

And according to LinkedIn data, companies with strong internal mobility programs fill roles 42% faster and see 31% lower turnover than companies that primarily hire externally.

Translation: Internal mobility isn't just cheaper—it's faster, more effective, and better for retention.

Why Internal Mobility Is Replacing External Hiring

1. Faster Time-to-Fill (and Time-to-Productivity)

External hires take 3-6 months to become fully productive (onboarding, learning the culture, building relationships).

Internal hires? 2-4 weeks.

Why?

• They already know the company culture
• They have existing relationships with colleagues
• They understand internal systems and processes
• No onboarding ramp needed

According to research from Mercer, internal hires reach full productivity 4.3x faster than external hires.

In fast-moving companies, this speed advantage is a game-changer.

Real example: Amazon's internal mobility program filled 12,000 roles in 2025 with an average time-to-productivity of 18 days—compared to 97 days for external hires.

2. Lower Cost (External Recruiting Is Expensive)

External hiring is brutally expensive:

• Recruiter time (sourcing, screening, coordinating)
• Job ads and sourcing tools
• Interview time (hiring managers, team members)
• Relocation and signing bonuses
• Onboarding and training

According to SHRM, the average cost-per-hire for an external candidate is $4,700 (and up to $28,000 for senior roles).

Internal mobility cost? $1,200 on average (mostly training and transition support).

Gartner estimates that companies with strong internal mobility programs save $3.5M per 1,000 employees per year compared to companies that primarily hire externally.

3. Retention Skyrockets (Internal Hires Stay Longer)

External hires leave within the first year 28% of the time, according to LinkedIn data.

Internal hires? Only 9% leave within the first year of their new role.

Why do internal hires stay longer?

• Career growth within the company (don't need to leave to advance)
• Cultural fit already proven (less risk of mismatch)
• Loyalty and investment (company invested in their development)

According to Mercer research, employees who make an internal move stay with the company an average of 3.4 years longer than employees who remain in the same role.

Translation: Internal mobility is the #1 retention strategy for 2025.

4. Better Quality of Hire (Known Entity vs. Unknown Risk)

External hiring is a gamble. Even with multiple interviews, references, and assessments, you're hiring a stranger and hoping they work out.

Internal hiring is low-risk:

• You know their work quality (performance reviews, manager feedback)
• You know their culture fit (they're already thriving here)
• You know their strengths and weaknesses (no surprises)

According to Gartner, internal hires have a 92% performance success rate (meet or exceed expectations) compared to 73% for external hires.

Less risk. Better outcomes.

5. AI-Powered Talent Marketplaces Make It Easy

The biggest barrier to internal mobility used to be visibility—employees didn't know what roles were open, and hiring managers didn't know who internally had the right skills.

Now? AI-powered talent marketplaces solve this.

Tools like:

• Gloat (used by Unilever, Mastercard, Seagate)
• Fuel50 (used by VMware, Citi, Schneider Electric)
• Workday Talent Marketplace (used by 2,000+ companies)
• Eightfold.ai Talent Intelligence (used by Visa, Tata, Capital One)

These platforms:

1. Match employees to open roles (based on skills, experience, career goals)
2. Recommend internal candidates to hiring managers (before external job posts)
3. Surface skill gaps (and recommend training to close them)
4. Enable gig/project-based work (short-term internal projects, not just full-time moves)

Real example: Unilever uses Gloat's talent marketplace and filled 68% of open roles internally in 2025, up from 32% in 2022. Employees browse open roles like they'd browse Netflix—see a match, apply, and move within weeks.

6. Employees Demand Career Growth (or They Leave)

According to LinkedIn's Workplace Learning Report, #1 reason employees leave is "lack of career growth opportunities."

And Gallup research shows that 59% of Millennials and Gen Z workers say "opportunities to learn and grow" are extremely important when evaluating a job.

Internal mobility programs solve this. Employees don't need to leave to advance—they can move laterally, upward, or into entirely new functions within the same company.

Real example: Schneider Electric's internal mobility program allows employees to apply for any open role globally. Result: 58% of roles filled internally, and employee engagement scores up 19%.

How Internal Mobility Programs Work (The New Model)

Traditional recruiting: Post job → Source candidates → Screen externally → Hire

New internal mobility model:

Step 1: Skills Inventory

• AI-powered skills assessment (what skills do employees actually have?)
• Dynamic skills profiles (updated continuously based on projects, training, feedback)

Step 2: Internal Talent Marketplace

• Open roles posted internally first (48-72 hour head start before going external)
• AI-powered matching (employees see roles that fit their skills + career goals)
• Easy application process (one-click apply, no resume needed)

Step 3: Hiring Manager Review

• Internal candidates reviewed first (before external pipeline)
• Manager-to-manager conversations (current manager and hiring manager discuss fit)
• Transparent process (employees know status of their application)

Step 4: Transition Support

• Training and skill development (if there's a small skills gap)
• Onboarding support (even though they're internal, new role = new expectations)
• Manager handoff (current manager supports transition, not blocks it)

Step 5: Continuous Talent Circulation

• Gig projects and short-term assignments (not just permanent moves)
• Stretch assignments (temporary projects to test skills in new areas)
• Mentorship and shadowing (explore new paths without committing)

Real-World Examples: Who's Winning with Internal Mobility

Unilever

• Deployed Gloat's AI talent marketplace in 2023
• 68% of roles filled internally in 2025 (up from 32% in 2022)
• 31% reduction in external recruiting costs
• Employee engagement scores up 23%

Amazon

• Massive internal mobility program called "Career Choice"
• Filled 12,000 roles internally in 2025
• Time-to-productivity 4.1x faster than external hires
• Retention up 19% for employees who made internal moves

Mastercard

• Uses Gloat + internal career pathing tools
• 54% of roles filled internally in 2025
• Employees average 2.3 internal moves during their tenure (vs. 0.4 in 2020)
• Turnover down 28% since launching internal mobility program

Schneider Electric

• Global internal mobility program + AI skills matching
• 58% internal fill rate in 2025
• Employees can apply for any role globally (10,000+ openings per year)
• Engagement scores up 19%, turnover down 22%

Walmart

• Live Better U program + internal career marketplace
• Promotes 350,000+ employees per year (mostly internal moves)
• 75% of managers started as hourly associates
• Retention 2.1x higher for employees who made internal moves

What This Means for Recruiters (Adapt or Die)

If 61% of roles are filled internally, what do external recruiters do?

Option 1: Become an Internal Mobility Specialist

The smartest recruiters are shifting from "talent acquisition" to "talent circulation."

New responsibilities:

• Manage internal talent marketplace (match employees to open roles)
• Career pathing and coaching (help employees plan their next move)
• Skills gap analysis (identify training needs to prepare employees for internal moves)
• Internal candidate advocacy (champion internal hires, break down barriers)

Real example: IBM rebranded its recruiting team as "Talent Mobility Advisors" who split time 60/40 between internal mobility and external hiring.

Option 2: Focus on Net-New Roles and Hard-to-Fill Positions

Internal mobility works for existing roles and known skill sets.

But companies still need external recruiters for:

• Brand-new roles (no one internally has the skills yet)
• Niche, highly specialized skills (e.g., quantum computing, regulatory compliance)
• Senior leadership hires (C-suite, VP-level)
• Geographic expansion (opening new offices/markets)

Recruiters who specialize in hard-to-fill, high-value roles will stay relevant.

Option 3: Build Hybrid Skills (Internal + External)

The future recruiter is fluent in both internal mobility and external sourcing.

Hybrid recruiting workflow:

1. Check internal talent marketplace first (any qualified employees?)
2. If no internal match, go external (traditional sourcing)
3. Consider internal + external blends (hire externally for 60% of role, promote internally for 40%)

Real example: Cisco's recruiting team spends 70% of time on internal mobility, 30% on external hiring—and they've increased fill rate by 38% while reducing costs by 29%.

What This Means for Employees (Take Control of Your Career)

If internal mobility is the future, employees need to think like free agents within their own company.

How to Leverage Internal Mobility:

1. Build a strong internal brand

• Deliver great work (reputation matters)
• Build cross-functional relationships
• Make your skills visible (projects, presentations, internal posts)

2. Own your career development

• Use your company's talent marketplace (if available)
• Talk to your manager about career goals
• Explore internal roles proactively (don't wait for layoffs or boredom)

3. Skill up continuously

• Take internal training programs
• Volunteer for stretch assignments
• Build skills for roles you want next (not just your current role)

4. Network internally

• Build relationships across teams
• Informational interviews with leaders in roles you're interested in
• Make yourself known beyond your immediate team

5. Don't wait for permission

• Many companies allow you to apply for internal roles without manager approval
• If your company requires manager approval, have the conversation early

The Bottom Line

Internal mobility is replacing external recruiting at Fortune 500 companies. 61% of roles are now filled internally—and that number is rising.

Why internal mobility is winning:

• 4.3x faster time-to-productivity
• $3.5M savings per 1,000 employees
• 3.4 years longer retention
• 92% performance success rate

What this means for recruiters:

• Shift from "talent acquisition" to "talent circulation"
• Focus on internal marketplaces and career pathing
• Specialize in hard-to-fill external roles
• Build hybrid skills (internal + external)

What this means for employees:

• Take control of your career development
• Leverage internal talent marketplaces
• Build your internal brand
• Explore internal moves before external job searches

The future of recruiting isn't about finding talent outside the company—it's about circulating talent inside the company.

External recruiters who don't adapt will find themselves managing an increasingly small percentage of hires. The smartest recruiters are already pivoting to internal mobility.

The question is: will you adapt, or will you become obsolete?