AI disruption, geopolitics cloud IT hiring plans for FY27
Global tech layoffs and weak spending dampen sentiment
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Bengaluru: Indian IT services companies are likely to project a subdued hiring outlook for FY27, as most firms remain cautious amid an uncertain business environment.
According to HR sector experts, IT companies are currently hiring technology professionals largely on a need basis, with a focus on advanced artificial intelligence (AI)-related skills.
“FY27 hiring projections are expected to be subdued as IT companies are in a ‘wait and watch’ mode due to the ongoing West Asia conflict. The situation appears to be spreading, impacting more sectors,” said Aditya Narayan Mishra, CEO of CIEL HR.
He added that fourth-quarter performance, in terms of overall headcount growth, is likely to be similar to the third quarter of FY26. Overall, headcount growth has remained tepid in the first nine months of the current financial year.
The top five IT companies, including TCS, Infosys, HCLTech, Wipro and Tech Mahindra, added just 17 net employees in the first nine months of FY26, compared to 17,764 net additions in the same period last year.
During the third quarter ended December 2025, TCS reported a decline of 11,151 employees in its workforce, while Tech Mahindra’s headcount fell by 3,098 on a sequential basis. HCLTech also saw a decline of 261 employees during the period. However, Infosys added 5,043 employees in Q3 FY26, while Wipro reported a sequential increase of 6,529 employees.
This mixed hiring trend reflects tighter demand, lower discretionary spending, and AI-led disruption in delivery models.
Industry reports indicate that, apart from AI-driven automation, the ongoing West Asia conflict has begun to affect hiring sentiment in the IT sector.
“While it is early to attribute the slowdown solely to the escalating geopolitical situation, a near-term impact on hiring pipelines is likely. The current sluggish trend in tech talent demand could persist if macro uncertainties intensify or remain unchanged,” HR consultancy Xpheno said in a report.
According to the report, FY27 is set to witness the second-lowest start in active tech demand over the past six years. “Beyond the cyclical annual clean-up of job postings, fresh demand has been hit by knee-jerk reactions to global events,” it added.
Meanwhile, layoffs by global technology majors are also dampening hiring sentiment in the near term. Reports suggest that around 30,000 employees have been laid off by Oracle, with about 12,000 impacted in India.
Such large-scale layoffs by global tech firms are making Indian IT companies more cautious in the near term, industry sources said.
