Bengaluru: For years, India’s IT-BPM industry ran on a fairly predictable rhythm — big campus hiring drives, steady lateral movement after appraisal season, and net headcount numbers that climbed almost every year without fail. That rhythm is now breaking. A new industry study projects that IT jobs India AI is redefining the sector will see net headcount additions fall nearly 26 percent in the first half of FY27, a sign that the old hiring playbook may no longer apply.
According to the India IT-BPM Workforce Outlook Report 2027 by HAN Digital Solution, net additions across the sector are expected to slip below 70,000 in H1 FY27, down from roughly 95,000 in the same period a year earlier. It’s one of the weakest hiring stretches the industry has seen in recent memory, and the report is careful to frame it not as a passing rough patch, but as a structural shift in how technology companies think about people.
Not a Slowdown, a Reset
What makes this IT-BPM hiring 2026 story different from past downturns is the reasoning behind it. Previous slowdowns tended to track global demand cycles — a recession here, a client budget freeze there. This one is different because even as revenue stabilizes, the hiring hasn’t bounced back the way it used to. Saravanan Balasundarm, Founder and CEO, HAN Digital Solution said it was a deliberate recalibration, not a cyclical dip. Companies were reshaping their hiring models around AI-driven productivity, leaner teams and a growing preference for flexible and project-based talent over large permanent workforces.
Traditionally, the second and third quarters of the fiscal year have been the industry’s busiest hiring window, powered by fresh campus onboarding and internal promotions triggering new lateral hires. This year, that seasonal surge is expected to fall well short of its usual scale — a real departure from a pattern the sector has followed for over a decade.
Where the Cuts Are Landing
The report points to specific categories of work that are shrinking fastest under this AI workforce disruption. Roles built around repetitive, lower-complexity tasks — generic Java and .NET development, digital marketing execution, campaign management, basic technical support (the L1 and L2 tiers), traditional quality assurance, and routine customer service and incident management — are the ones AI agents are absorbing first. These were historically the entry points for large volumes of fresh graduates, which partly explains why net additions are taking such a visible hit.
It isn’t just entry-level roles feeling the squeeze either. Mid-career professionals in execution-heavy delivery positions are reportedly being phased out earlier than past norms would suggest, as companies lean harder into automation for work that used to require sizeable human teams.
The numbers from India’s largest listed IT firms back up the broader trend. TCS, the country’s biggest IT employer, cut around 12,000 roles through FY26 as part of what it called a “future-ready transformation,” and has reportedly scaled back its fresh graduate hiring to around 25,000 this year compared to an average of 40,000 annually over the previous three years. Tech Mahindra and HCLTech have also reported sequential headcount declines in recent quarters, while Infosys stood out as something of an exception, adding roughly 5,000 employees — though even that pace lagged its own hiring from the year before.
Not every part of the industry is shrinking, though. The banking, financial services and insurance segment is bucking the broader trend, with hiring actually picking up there, largely driven by AI integration projects and the compliance demands that come with them.
The Reskilling Conversation Gets Louder
All of this has reignited a debate that’s been simmering in India tech employment circles for a while now — how prepared is the workforce for a job market this different from the one it trained for? The mismatch is a real structural problem: the people being displaced by automation often don’t have the specialized AI or LLM-adjacent skills the new roles demand, so companies can’t simply move people sideways into different jobs.
Some firms are responding by investing more heavily in reskilling IT sector talent rather than trimming headcount outright. Industry surveys suggest a meaningful share of companies are now prioritizing internal training programs over layoffs to bridge this gap — though that comes with its own cost, since upskilling large numbers of employees while also paying a premium for scarce AI talent puts pressure on margins.
Everest Group’s Jimit Arora put it simply: with AI and what’s being called “vibe coding,” companies can now push far more code into production with a fraction of the headcount they once needed. Teams aren’t disappearing altogether, but the traditional way of getting things done — with large delivery benches — is being rebuilt around getting more output from fewer people.
What Comes Next
The HAN Digital report doesn’t paint this as the end of hiring altogether. It expects hiring to gradually improve in select segments even as the overall pace stays muted, with a growing tilt toward contract and flexible staffing arrangements rather than full-time headcount expansion. As Balasundaram put it, the next phase of growth for the industry won’t be measured by how many people companies hire, but by the kind of capabilities those people bring — and how effectively they work alongside AI rather than in spite of it.
For India’s vast IT workforce, that’s a meaningful shift in what a career in tech is expected to look like going forward — one where staying relevant may depend less on experience alone and more on how quickly professionals can adapt to tools that are rewriting the job description underneath them.
