A new study by Pearson and AWS, based on 500+ survey responses, finds strong AI adoption by students but misalignment with employer needs, limited employer–university engagement, and low ratings of graduate AI evaluation skills. The report highlights three priorities: embedding applied AI experience in learning, strengthening faculty capability, and building tighter employer feedback loops. It introduces an AI Readiness Friction Framework with six barriers: pace, connection, capability, governance, experience, and skills friction. Key data points include: 80% of U.S. college students reporting active use of AI tools; 69% of U.S. employers who say AI makes university education more essential; 23% of students receiving hands-on, applied AI use in real-world contexts; 10% of higher education leaders reporting ongoing, frequent engagement with employers; and 12% of employers rating U.S. graduates as excellent at evaluating AI outputs.