IT hiring falls to 28-month low, but demand for AI talent remains strong
Active tech job openings fall to a 28-month low as IT services firms rethink hiring strategies, while demand for AI, cloud and cybersecurity talent remains resilient.
- Jun 8, 2026,
- Updated Jun 8, 2026 10:36 AM IST
India's technology hiring market is undergoing a structural reset, with companies moving away from the high-volume recruitment cycles that defined the post-pandemic years and embracing a more cautious, demand-driven approach to workforce planning.
Must read: India’s semiconductor moment is bigger than outsourcing: UST COO Gilroy Mathew
Active technology job openings fell to a 28-month low of 93,000 at the start of June, down from 119,000 in March, according to data from talent intelligence platform Xpheno. The figure represents a 14% decline from the previous month and a 17% drop compared with June 2025.
"The Indian tech sector's talent demand remains hyper-elastic to market uncertainties impacted by geopolitical and geoeconomic events," said Kamal Karanth, co-founder of Xpheno. "While tech hiring was always elastic, post-pandemic, there has been a shift to hyper-elasticity with the overall hiring outlook turning conservative."
The slowdown comes as major IT services firms increasingly acknowledge that revenue growth is becoming less dependent on headcount additions, particularly as artificial intelligence is deployed across software development, support functions and internal operations.
Last month, Tata Consultancy Services (TCS) said it had made 25,000 fresher offers, while Infosys is expected to hire about 20,000 freshers in FY27. The numbers are significantly lower than in recent years. TCS, for instance, has hired more than 40,000 freshers annually over the last three years.
Must read: From data migration to AI agents: Why Snowflake is betting big on India
Xpheno's data reflects this moderation. Entry-level openings have declined 44% year-on-year, while senior-level positions are down 67%.
Yet recruiters argue that the decline is not solely a result of weaker demand. Instead, companies are increasingly shifting towards just-in-time hiring models rather than maintaining large benches of employees.
According to Careernet, direct campus hiring remains 30-35% below historical levels. The talent solutions firm attributes the slowdown to three factors: global macroeconomic uncertainty that has delayed discretionary technology spending, growing use of AI to automate routine tasks, and the industry's continued normalisation after the hiring surge of 2021 and 2022.
"While hiring activity has moderated, this reflects a structural recalibration of demand rather than a broad-based contraction of the technology sector," said Neelabh Shukla, Chief Business Officer at Careernet.
The impact, however, is not uniform across the industry.
Must read: Indian IT's hiring model is changing...and AI is the reason
Demand from IT services companies dropped 16% month-on-month to about 36,000 openings, according to Xpheno. In contrast, hiring by global capability centres (GCCs) has remained relatively resilient. GCCs, which account for 18% of overall active demand, saw openings decline 6% month-on-month but still recorded a 31% increase compared with a year earlier.
Industry observers say the market is witnessing a broader shift from hiring for scale to hiring for capability.
"What we are seeing is a transition from the expansive hiring cycles of the post-pandemic period to a more disciplined phase of workforce planning. Employers are increasingly focused on hiring for strategic capabilities rather than scaling headcount across the board," said Sashi Kumar, Managing Director of Indeed India.
That shift is becoming visible across job categories. While hiring has slowed in areas such as IT systems and solutions and data and analytics, hiring for IT infrastructure, operations and support has increased 20% year-on-year on Indeed's platform.
"Employers are increasingly concentrating recruitment around specialised skills that can help deploy AI, modernise infrastructure, and deliver measurable business impact. The result is a more focused and skills-led tech labour market, where hiring decisions are increasingly driven by strategic priorities rather than workforce expansion alone," Kumar said.
Must read: Indian IT’s fresher hiring slump signals structural shift, not just slowdown
Indeed's data shows technology job postings were up 8.2% year-on-year as of May 29, even as overall job postings across the labour market declined 1.9%.
Recruiters say the strongest demand continues to be concentrated in emerging technology domains. AI and machine learning, cloud computing and cybersecurity remain among the most sought-after skills, even as employers struggle to find qualified talent.
"This imbalance is particularly evident in cybersecurity, where emerging domains are facing acute talent shortages. Ultimately, what we are witnessing is not simply a slowdown in hiring, but a shift in demand toward specialised, future-ready skills that are increasingly critical to business growth and resilience," Shukla said.
Karanth believes part of the slowdown is also linked to developments in the United States, particularly uncertainty surrounding the H-1B visa programme.
"The H1B program is a key enabler for the tech sector's market access, project delivery and client servicing. The fast-changing dynamics around H1B and its future uncertainty have hit hiring plans and enterprises are pulling jobs out from the market," he said.
Must read: Why India’s GCCs are hiring fewer full-timers and more AI contractors
Despite the current slowdown, recruiters do not expect hiring activity to remain subdued indefinitely. However, a return to the mass recruitment cycles that once characterised India's IT industry appears increasingly unlikely.
"We do anticipate pent-up demand for entry-level professionals from IT services organisations, particularly as concerns around AI spending and returns on investment continue to evolve," said Shukla, adding that hiring could see a targeted recovery in the second half of the year.
For now, the era of hiring thousands of employees in anticipation of future demand appears to be giving way to a more measured approach. As companies embrace just-in-time workforce planning and AI-driven productivity gains, recruitment is becoming less about adding numbers and more about securing specialised talent capable of delivering immediate business impact.
For Unparalleled coverage of India's Businesses and Economy – Subscribe to Business Today Magazine
India's technology hiring market is undergoing a structural reset, with companies moving away from the high-volume recruitment cycles that defined the post-pandemic years and embracing a more cautious, demand-driven approach to workforce planning.
Must read: India’s semiconductor moment is bigger than outsourcing: UST COO Gilroy Mathew
Active technology job openings fell to a 28-month low of 93,000 at the start of June, down from 119,000 in March, according to data from talent intelligence platform Xpheno. The figure represents a 14% decline from the previous month and a 17% drop compared with June 2025.
"The Indian tech sector's talent demand remains hyper-elastic to market uncertainties impacted by geopolitical and geoeconomic events," said Kamal Karanth, co-founder of Xpheno. "While tech hiring was always elastic, post-pandemic, there has been a shift to hyper-elasticity with the overall hiring outlook turning conservative."
The slowdown comes as major IT services firms increasingly acknowledge that revenue growth is becoming less dependent on headcount additions, particularly as artificial intelligence is deployed across software development, support functions and internal operations.
Last month, Tata Consultancy Services (TCS) said it had made 25,000 fresher offers, while Infosys is expected to hire about 20,000 freshers in FY27. The numbers are significantly lower than in recent years. TCS, for instance, has hired more than 40,000 freshers annually over the last three years.
Must read: From data migration to AI agents: Why Snowflake is betting big on India
Xpheno's data reflects this moderation. Entry-level openings have declined 44% year-on-year, while senior-level positions are down 67%.
Yet recruiters argue that the decline is not solely a result of weaker demand. Instead, companies are increasingly shifting towards just-in-time hiring models rather than maintaining large benches of employees.
According to Careernet, direct campus hiring remains 30-35% below historical levels. The talent solutions firm attributes the slowdown to three factors: global macroeconomic uncertainty that has delayed discretionary technology spending, growing use of AI to automate routine tasks, and the industry's continued normalisation after the hiring surge of 2021 and 2022.
"While hiring activity has moderated, this reflects a structural recalibration of demand rather than a broad-based contraction of the technology sector," said Neelabh Shukla, Chief Business Officer at Careernet.
The impact, however, is not uniform across the industry.
Must read: Indian IT's hiring model is changing...and AI is the reason
Demand from IT services companies dropped 16% month-on-month to about 36,000 openings, according to Xpheno. In contrast, hiring by global capability centres (GCCs) has remained relatively resilient. GCCs, which account for 18% of overall active demand, saw openings decline 6% month-on-month but still recorded a 31% increase compared with a year earlier.
Industry observers say the market is witnessing a broader shift from hiring for scale to hiring for capability.
"What we are seeing is a transition from the expansive hiring cycles of the post-pandemic period to a more disciplined phase of workforce planning. Employers are increasingly focused on hiring for strategic capabilities rather than scaling headcount across the board," said Sashi Kumar, Managing Director of Indeed India.
That shift is becoming visible across job categories. While hiring has slowed in areas such as IT systems and solutions and data and analytics, hiring for IT infrastructure, operations and support has increased 20% year-on-year on Indeed's platform.
"Employers are increasingly concentrating recruitment around specialised skills that can help deploy AI, modernise infrastructure, and deliver measurable business impact. The result is a more focused and skills-led tech labour market, where hiring decisions are increasingly driven by strategic priorities rather than workforce expansion alone," Kumar said.
Must read: Indian IT’s fresher hiring slump signals structural shift, not just slowdown
Indeed's data shows technology job postings were up 8.2% year-on-year as of May 29, even as overall job postings across the labour market declined 1.9%.
Recruiters say the strongest demand continues to be concentrated in emerging technology domains. AI and machine learning, cloud computing and cybersecurity remain among the most sought-after skills, even as employers struggle to find qualified talent.
"This imbalance is particularly evident in cybersecurity, where emerging domains are facing acute talent shortages. Ultimately, what we are witnessing is not simply a slowdown in hiring, but a shift in demand toward specialised, future-ready skills that are increasingly critical to business growth and resilience," Shukla said.
Karanth believes part of the slowdown is also linked to developments in the United States, particularly uncertainty surrounding the H-1B visa programme.
"The H1B program is a key enabler for the tech sector's market access, project delivery and client servicing. The fast-changing dynamics around H1B and its future uncertainty have hit hiring plans and enterprises are pulling jobs out from the market," he said.
Must read: Why India’s GCCs are hiring fewer full-timers and more AI contractors
Despite the current slowdown, recruiters do not expect hiring activity to remain subdued indefinitely. However, a return to the mass recruitment cycles that once characterised India's IT industry appears increasingly unlikely.
"We do anticipate pent-up demand for entry-level professionals from IT services organisations, particularly as concerns around AI spending and returns on investment continue to evolve," said Shukla, adding that hiring could see a targeted recovery in the second half of the year.
For now, the era of hiring thousands of employees in anticipation of future demand appears to be giving way to a more measured approach. As companies embrace just-in-time workforce planning and AI-driven productivity gains, recruitment is becoming less about adding numbers and more about securing specialised talent capable of delivering immediate business impact.
For Unparalleled coverage of India's Businesses and Economy – Subscribe to Business Today Magazine