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India's top five IT companies added just 17 net jobs in the first nine months of the last financial year, down from 11,000 the year before. For HR professionals, that number signals a structural reset in India's white-collar job market - one where entry-level roles are vanishing and employers are demanding more from fewer hires.

The slowdown extends beyond tech. Unemployment is acute among the under-35 cohort, with some estimates putting it as high as 40 per cent. Freshers are worst hit: with basic coding and testing now heavily automated, as much as 25 per cent of entry-level jobs have disappeared. Tata Consultancy Services, India's largest IT services company, alone has cut more than 23,000 jobs in FY26.

"Full-time jobs are not providing a pathway to prosperity. That's the major grievance young people have," said Rathin Roy, economist and former member of the Prime Minister's Economic Advisory Council.

The IT slowdown is a bellwether

India's IT sector was the country's sunrise industry since the 1990s, adding roughly 100,000 new jobs a year by the 2010s. That engine has stalled. In the first nine months of the last financial year, the top five Indian IT companies added just 17 people. This year's trend is worse, with a 17 per cent drop on last year and a 60 per cent fall from the post-pandemic hiring spree of 2022.

The collapse is concentrated at the entry level. "The bottom rung of the ladder is breaking," said Jaspreet Bindra, founder of AI & Beyond, a tech-literacy platform. Bindra cautions against blaming AI alone: "It is often beneficial to pin the blame on AI, because it drives up your stock when you say you've let people go for that reason."

Why hiring froze

Several forces collided. After Covid, flush with government stimulus and a surge in consumption, companies went on a hiring spree. Global events dulled that optimism - wars from Ukraine to Iran and Donald Trump's tariff offensive pushed the Indian economy into a K-shaped spiral that squeezed the working class's spending power.

India's capital markets peaked in September 2024 and have traded below that level for nearly two years. "When valuations cool off like this, there is genuine pressure on companies to boost their bottom line," said Balasubramanian Anantha Narayanan, senior vice-president of TeamLease.

Festival and summer sales have been dull despite the government cutting repo rates, raising income tax exemption limits and rationalising GST. The monsoon underdelivered, with June the driest in twelve years. "You cannot pass all of that cost increase on to customers - you have to absorb some while protecting your market share," said Narayanan. For most corporations, the way out has been layoffs and a freeze on fresh hiring. "The focus now is a lot more on productivity."

What employers want now

The old formula - finish school, get an engineering degree, then an MBA, hop on the corporate conveyor belt - is breaking. "It isn't that jobs no longer exist - it's that they've changed," said Bindra. "People who can adapt using AI are getting great jobs."

India is going through a jobs reset, said Roopank Chaudhary, partner and rewards leader at Aon. "Entry-level jobs are being reshaped by AI, automation and digital workflows. Employers are becoming far more selective."

Hiring decisions are shifting from technical pedigree to adaptability. "The correlation between the nature of your degree, even the school you went to, and the job you end up doing is increasingly weak," said Narayanan. He points to Japan and Germany, where students learn practical skills from class seven or eight and intern with companies from age twelve or thirteen. "I have seen someone with an ITI certificate who is a better engineer than an engineer."

There is also a mismatch between where jobs are and where jobseekers look. "The greatest irony in our country is that employers can't find enough talent, and people can't find enough jobs," said Prof Chandrasekhar Sripada of the Indian School of Business, Hyderabad. "Our urban-centric, office-based employment models don't connect demand with supply."

Why this matters for HR professionals

For HR teams, the practical implications are direct. Entry-level hiring criteria built on degrees and pedigree no longer predict performance; screening for adaptability, problem-solving and AI fluency matters more. The talent pool is also wider than the urban campus circuit - tier-2 and tier-3 towns hold skilled candidates that remote-work models could tap.

The reset also changes retention. With attrition cooling and employers more selective, the burden shifts to upskilling existing staff. As Vimal Dangri, chief human resources officer at Mastek, put it: "The future belongs to those who remain curious, adaptable and committed to lifelong learning."