Impact of AI and Automation on India's Technology Hiring Landscape

The rapid ascent of artificial intelligence and automation is significantly reshaping India's technology hiring landscape, particularly affecting entry-level workers. This transformation sees AI taking over tasks such as basic testing, coding, and web development, reducing the demand for engineering graduates in IT firms.

Shrinking Entry Layer

• IT firms are hiring fewer freshers, with entry-level hiring at its lowest in two decades, between 60,000 and 70,000 freshers in FY24.
• While revenues surged by around 60% between FY20 and FY25, headcount expanded by only 33%.
• Firms are generating `1.82 in revenue per rupee spent on employees, a slight increase from `1.77 in 2020.
• C Vijayakumar of HCLTech noted the need for disruption in the business model, emphasizing a shift from linear scaling to a focus on productivity and efficiency.

Campus Calls

• Educational institutions experience a transition in campus placements, with IT firms becoming more cautious and rigorous in their hiring processes.
• There is a growing emphasis on pre-placement internships and skill assessments.
• Selective recruitment is targeting individuals with niche skills instead of bulk hiring.
• Students enhance resumes with open-source projects and AI models, highlighting the importance of both programming and AI skills.
• Companies now focus more on system design, real-time debugging, and critical thinking during technical rounds.

GCC Talent Drain

• The rise of Global Capability Centres (GCCs) is causing a talent drain from traditional IT firms, particularly in Tier-1 cities.
• There is a shortage of 200,000 skilled professionals in AI, cloud, and cybersecurity areas.
• Emerging tech roles in GCCs offer 30-50% higher salaries than IT services companies.