The tech industry's hiring outlook, initially set for a rebound in FY26, is now on the decline. Projections indicate 3 lakh fewer jobs in FY26 due to escalating macroeconomic uncertainties, according to analysts.
The tech industry was predicted to see a revenue growth of 5-7%, which would translate to 12 lakh gross hires (including attrition backfill and new business). However, with US tariff wars, recession fears, geopolitical risk tightening the discretionary spends, growth rate would reduce to 3-5%, resulting in 9 lakh gross hires, shows data from UnearthInsight, a market intelligence firm.
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The IT industry faced a hiring slump in 2023-24 due to a weak demand environment. While signs of recovery were being seen since, geopolitical uncertainties since the new Trump administration have added new challenges, impacting tech spending decisions and delaying growth in the sector.
“Freshers are expected to make up 15 to 17% of gross hiring, with a range of 1.3 to 1.5 lakh. New-age skills freshers will represent a larger percentage, particularly for MNC IT services and GCCs. Meanwhile, Indian IT service providers will continue to focus on hiring freshers in Tier II cities for roles such as testing, coding, maintenance, service desk, and support,” said Gaurav Vasu, Founder of UnearthInsight.
Similarly, staffing firm Xpheno notes that specifically the IT services cohort's outlook remains sluggish with a 1-1.2 lakh net additions forecast, while under positive macro conditions, the IT services sector's net additions outlook would have been upwards of 2.5 lakh.
“The delayed recovery and sustained headwinds for the IT services sector will continue to keep a low-to-moderate optimism in the hiring plans of the sector. The continuing sluggishness in enterprise tech spends and market uncertainties, will keep the tech sector on the cautious end of hiring and talent acquisition plans. A gradual and slow-paced recovery of hiring action is to be expected, as compared to a bounce back predicted earlier for the upcoming fiscal,” said Kamal Karanth, Co-founder, Xpheno.
The tech industry in India grew at 5.1%, adding $13.8 billion incremental revenue, taking the total industry revenue to over $282.6 billion, in FY25. Sub-sectors like Engineering R&D, with GCCs spanning across Services and BPM, have emerged as key growth hotspots. The industry added 126,000 net new employees in FY25, according to tech industry body Nasscom's recent strategic review report.
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