India’s Hiring Outlook softens but Still Leads the World

After reaching a peak last quarter, India’s employment outlook cools, reflecting a more cautious approach by employers amid global economic and geopolitical uncertainty. Yet, despite the moderation, India continues to lead the world in hiring optimism, underscoring the country’s resilience and growth potential.

India's hiring outlook leads the world  (AI Generated image)

A Shift Toward Selective Hiring  

The latest Employment Outlook Survey, based on interviews with over 3,100 employers across India, reveals that hiring intentions for Q3 2026 have declined by 29% compared to Q2. The Net Employment Outlook (NEO) now stands at 48% — down 20 points from the previous quarter, but still 6 points stronger than the same period last year.  

“India’s Q3 hiring outlook remains the strongest globally,” said Sandeep Gulati, Managing Director, ManpowerGroup that conducted the survey. “The moderation reflects a more measured approach to hiring rather than a loss of confidence. Employers are navigating challenges such as AI-led workforce optimization, softer entry-level demand, and global trade uncertainty, but remain positive about long-term growth.” 

Sectoral and Regional Trends  

Hiring sentiment eased across most sectors, with eight of nine industries reporting quarter-on-quarter declines.  

- Trade & Logistics saw the steepest drop (44%), followed by Public Sector, Health & Social Services (37%) and the Information sector (47%).  

- Hospitality was the only sector to post growth, rising 6 points since Q2.  

- Utilities & Natural Resources remains India’s most competitive sector with an outlook of 61, ranking first globally despite a slight quarterly dip.  

- Finance & Insurance recorded one of the strongest year-on-year gains, up 14 points since Q2 2025.  

Regionally, the East leads with a NEO of 52, though down 16 points from last quarter. The South showed the greatest annual improvement, rising 10 points since Q3 2025. Large organizations (1,000–4,999 employees) remain the most optimistic, with a NEO of 56, well above global averages.

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AI’s Role in Hiring Decisions  

While artificial intelligence is reshaping workforce strategies, employers continue to value human judgment most.  

- Resume review by people (75%) remains the top hiring resource, ahead of AI-driven tools.  

- Employers place the highest premium on communication, collaboration, and problem-solving skills, highlighting the enduring importance of human adaptability.  

- At the same time, technical skills in AI model development, IT, and data literacy are commanding higher pay premiums, alongside sales and marketing expertise.

Looking Ahead  

The survey underscores a dual reality: India’s hiring momentum has cooled from record highs, but the country remains the global leader in employment optimism. Employers are balancing short-term caution with long-term investments in skills, capability building, and workforce resilience.  

As Gulati noted, “Organizations are looking beyond immediate hiring needs and investing in talent that supports productivity, innovation, and sustainable growth.”  

The full Q3 2026 Employment Outlook Survey results are available at [ManpowerGroup India](https://manpowergroup.co.in/meos-q3-2026.aspx). 

The next update, covering Q4 2026 expectations, will be released in September.