But the point of Olympic medals is to assess skill. If the available pool of talented athletes is larger than the number of gold medals, then there is a need for more gold medals.
I think the point people are missing is that you don't need more gold medals. Rather, the people "hiring" athletes need to recognize that for many purposes the difference between gold and silver and bronze and first and second runner up to bronze is trivial and possibly arbitrary, especially in situations where outcomes are not nearly as easily quantified as in an athletic competition.
But the point of Olympic medals is to assess skill. If the available pool of talented athletes is larger than the number of gold medals, then there is a need for more gold medals.