The Indian IT hiring story is getting bleaker as global outsourcing demand remains weak amid uncertainty over potential US tariffs, according to data from multiple recruitment firms.
IT services companies have cut their overall hiring projections for July-December to 1-3% from 3-5% earlier, data from mass staffing firm Teamlease showed.
Aditya Mishra, managing director and CEO of Mumbai-based recruitment firm CIEL HR, said the sector was expected to add about 10-11% net headcount at the start of FY26, but the outlook has since moderated to 6-8%.
The industry is short by nearly 150,000 hires compared to start-of-year projections, he said.
Recruitment agencies said hiring demand for software engineers has contracted sharply, with growth confined to emerging technology roles.
Adecco India data showed overall hiring in the first half of calendar 2025 declined by nearly 7% from a year earlier, largely due to global demand slowdown and sustained cost pressures.
“Global trade uncertainties are influencing hiring decisions for nearly 90% of IT companies, while AI adoption and cost pressures are prompting a more measured approach to workforce expansion,” said Sanketh Chengappa KG, business head – professional staffing, at Adecco India. “Together, these factors point to a calibrated but resilient demand outlook for the sector through the second half of the year,” Chengappa added.
Earlier, the hiring outlook for the second half was somewhat positive, in the hope that tariff-related uncertainty would settle down, allowing IT majors to close some large deals.
However, their clients remain vary of increasing their technology outsourcing spending until there is visibility on the cost pressures arising from likely tariff changes.This is largely due to continued unresolved tensions between the US and India.
Hiring experts expect the ambiguity to continue for the next two quarters.
The hype over the Trump administration implementing the HIRE Act (Halting International Relocation of Employment Act) could deter additional hiring of workforce until there is clarity of business demand improvement, they said.
Teamlease expects a mild recovery of 2-4% in IT hiring in the October-December quarter after a decline of 2-3% in July-September, with an uptick in fresher intake along with rising demand for digital skills.“There will be project-linked hiring, some for GenAI and cybersecurity roles and seasonal demand for Q4 delivery cycles,” said Neeti Sharma, CEO of Teamlease Digital.
Adecco’s outlook for July-December is more optimistic, as it expects a 15-20% growth in both fresher and mid-level hiring.
Earlier this month, ET reported that hiring at India’s software service providers has slowed by 10% between July and August, with the trend likely to continue this year.
India’s largest IT firm Tata Consultancy Services (TCS) recently said it would lay off 2% of its workforce, or about 12,000 employees, in the financial year ending March, signalling a muted year in terms of business growth combined with the impact of AI.
Most experts in the outsourcing sector predict a measured hiring approach with companies focusing on niche talent in AI, ML, and data science roles.
“Demand for these skills has indeed stayed steady,” CIEL HR’s Mishra said. “However, contrary to projections of broader headcount expansion, most IT firms have resorted to hiring freezes or very cautious additions amid uncertainty due to US tariffs,” he added.