Gibbs is used at left-back by Gunners boss Arsene Wenger and is set for another extended run in the first team following an injury to Gael Clichy.
England manager Fabio Capello indicated the 20-year-old is one player he intends to keep a close eye on as he finalises his squad for the World Cup next summer.
And Pearce firmly believes Gibbs will learn from his latest Wembley experience.
"He played his part, but I think he can play better," said Pearce.
"There is more to come from Kieran and we will get more out of him on Tuesday in Lithuania, if selected.
"Kieran has played midfield before, although I think his position is at left-back.
"Ryan Bertrand has done outstandingly well for Reading recently and it was really that form which forced him into the team and enabled me to juggle Gibbsy a bit and put him into midfield.
"Kieran is a very athletic, clever player, good on the ball.
"Having one or two players who can play in different positions strengthens the squad.
"I see it as part of their education. It might just help him, give him a different slant on how to play the game.
"What I have to do is pick a team where most people are comfortable in their positions.
"Kieran has played there in midfield as a kid and I think it will serve him well."
Tottenham youngster Danny Rose netted his first goal for the Under-21s when he got on the end of a knockdown by Andy Carroll just before the break, which proved enough for victory in front of a crowd of 34,000.
England are now three points behind Group Nine leaders Greece, on whom they have a game in hand, ahead of next week's trip to Lithuania.
Rose, 19, has just returned to White Hart Lane following a spell on loan at Championship strugglers Peterborough and the youngster was pleased with his performance.
"The manager has talked to me about being in the box and we have worked on a few things in training, to make sure we have got runners going in around Andy," Rose said.
"He knocked it down and I was there to put it in."
Rose added: "All the lads are in good form and full of confidence.
"We have got to go to Lithuania now and get a result there, but hopefully with this win over Portugal we have put a good team out of the competition."