Bengaluru: India's IT-BPM industry is facing one of its weakest hiring phases in years, with net workforce additions expected to fall below 70,000 in the first half of FY27 (April-September), more than 26% below the estimated 95,000 added in the same period last year.

According to technology consulting and talent advisory firm HAN Digital's India IT-BPM Workforce Outlook Report 2027, shared with ET, the 5.95-million-strong industry is undergoing a structural reset as companies lean on AI-driven productivity, leaner operating models and flexible talent.

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ET Bureau

Organisations are expected to focus more on targeted hiring for strategic, high-value capabilities and AI-specific roles, while using contract and flexible staffing to backfill attrition rather than pursue traditional headcount-led growth.

Ongoing conflicts in West Asia and macroeconomic uncertainty are also pushing companies to exercise tighter cost controls.

"We expect overall net headcount growth across India's IT-BPM industry in FY27 to remain muted compared to last year, even as hiring activity gradually improves in select segments," said Saravanan Balasundaram, CEO, HAN Digital Solution. "At the same time, contract and flexible staffing will continue to gain momentum as enterprises increasingly favour project-based, outcome-driven talent models."

The IT-BPM hiring outlook is weakening across all three major segments. IT services, consulting, Big 4 and product engineering firms are expected to add 22,000-25,000 people in H1 FY27, down from 35,000 in the year-ago period. Global capability centres remain the strongest growth drivers, but even here, additions are expected to drop to 30,000-32,000 in the first half from 45,000 last year. Hiring is concentrated mostly in AI/ML engineering, platform, cyber technology and domain-specialist roles rather than broad-based delivery headcount.

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Pure-play BPOs, MLOps (machine learning operations) players and tech startups are expected to add 8,000-10,000 people in April-September 2026, against 15,000 in the corresponding period last year, the report found.

These projections reflect reported Q1 financials alongside insights from more than 350 companies surveyed.

The West Asia crisis has heightened macroeconomic uncertainty, with customers delaying discretionary spending and slowing technology spending in sectors such as retail, travel and manufacturing, said Sangeeta Gupta, senior vice-president, Nasscom.

The combination of the macroeconomic environment and AI is leading to a cautious outlook on hiring.

“There’s also been an impact on early career talent. Everyone is becoming more cautious—adopting a wait-and-watch attitude,” she added.

At the same time, baseline expectations for entry-level talent are rising. With fresher hiring slowing, companies now expect graduate hires to possess AI-assisted development fluency and production-ready skills when they join, rather than learn them on the job during their first year.

Meanwhile, mid-career professionals, particularly those in execution-heavy delivery roles, are leaving or being exited well before the traditional three-to-five-year mark as organisations flatten management layers and consolidate duplicate roles.

“At the less-than-five years attrition levels, companies are replacing less than 60% of the roles; often moving in freshers through upskilling or people on the bench,” said Balasundaram, estimating 40,000-50,000 net additions in the second half of the financial year.

“The next phase of growth will not be measured by how many people companies hire, but by the capabilities they bring into the organisation and how effectively they combine human expertise with AI,” he added.