Uncertainty Drags Down IT Jobs, Hiring Slips 10% in August

India’s IT services sector saw a 10% decline in overall hiring between July and August 2025,  according to Teamlease data. The fall comes as global economic uncertainties, higher U.S. tariffs, and weaker discretionary spending weigh on the $283-billion outsourcing industry.

Drop in Legacy Tech Roles

Openings for traditional technology jobs have continued to shrink. Xpheno reported that active vacancies in legacy tech fell to 43,000 in August, down 9% from July and 24% lower than the same time last year. Compared with September 2022, the decline stood at 41%, bringing demand close to a three-year low.

Shifts Toward New Skills

While demand for older roles is falling, requirements remain strong in areas such as artificial intelligence (AI), machine learning (ML), cloud, data, and cybersecurity. Teamlease noted that India needs more than 500,000 AI-skilled professionals, but currently has just one engineer available for every ten positions. This mismatch is creating sharp competition for talent in specialised domains.

Quarterly Hiring Trends

The industry had added around 9,000 employees in the June quarter, reflecting a 3% year-on-year rise in headcount. However, net additions slowed significantly compared with the March quarter. The top 6 IT firms, including Tata Consultancy Services (TCS) and Infosys, hired just over 3,800 people during the June quarter, nearly 72% lower than in the previous quarter, as per the ET report.

Read more: BFSI Sector Likely to Add 2,50,000 Jobs by 2030 Amid Digital and Tier 2, 3 Expansion!

Job Market Indicators

Across technology job categories, spanning IT services, startups, global capability centres (GCCs), and non-tech sectors, active openings stood at 102,000 in August. This was 1% lower than July and 24% lower on a year-on-year basis. The contribution of tech roles to total active demand has now fallen to 49%.

Conclusion

Staffing firms indicated that August also saw a nearly 20% fall in demand compared with July. The September quarter is expected to close below earlier projections, while festive breaks in India and year-end holidays in the U.S. and Europe may keep hiring subdued through December.

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