India's demand for active tech talent has reached a 28-month low, experiencing a significant 14% month-on-month and 17% year-on-year decline in June, primarily influenced by developments in the United States, its largest market. This downturn, intensified by a conservative hiring trend across all tech roles, is attributed to shifts in the US talent and enterprise contexts, including potential H-1B related repatriations to India, which could lead to returnee volumes exceeding outbound talent for the first time. The IT Services sector, a key talent consumer, saw a 16% month-on-month drop and a 31% year-on-year decrease in demand, though GCCs experienced a 31% year-on-year rise. While core Tech & Engineering functions still dominate demand, they too saw 14% month-on-month and 25% year-on-year declines, with consulting and advisory functions experiencing even steeper drops. Geographically, demand has shifted away from megacities, which saw a 17% month-on-month and 40% year-on-year decline, towards Tier 2 and Tier 3 locations, which doubled year-on-year despite an 8% month-on-month dip. Full-time work-from-office roles continue to comprise the majority of active tech openings.

India's demand for active tech talent has reached a 28-month low, experiencing a significant 14% month-on-month and 17% year-on-year decline in June, primarily influenced by developments in the United States, its largest market. This downturn, intensified by a conservative hiring trend across all tech roles, is attributed to shifts in the US talent and enterprise contexts, including potential H-1B related repatriations to India, which could lead to returnee volumes exceeding outbound talent for the first time. The IT Services sector, a key talent consumer, saw a 16% month-on-month drop and a 31% year-on-year decrease in demand, though GCCs experienced a 31% year-on-year rise. While core Tech & Engineering functions still dominate demand, they too saw 14% month-on-month and 25% year-on-year declines, with consulting and advisory functions experiencing even steeper drops. Geographically, demand has shifted away from megacities, which saw a 17% month-on-month and 40% year-on-year decline, towards Tier 2 and Tier 3 locations, which doubled year-on-year despite an 8% month-on-month dip. Full-time work-from-office roles continue to comprise the majority of active tech openings.

India's demand for active tech talent has reached a 28-month low, experiencing a significant 14% month-on-month and 17% year-on-year decline in June, primarily influenced by developments in the United States, its largest market. This downturn, intensified by a conservative hiring trend across all tech roles, is attributed to shifts in the US talent and enterprise contexts, including potential H-1B related repatriations to India, which could lead to returnee volumes exceeding outbound talent for the first time. The IT Services sector, a key talent consumer, saw a 16% month-on-month drop and a 31% year-on-year decrease in demand, though GCCs experienced a 31% year-on-year rise. While core Tech & Engineering functions still dominate demand, they too saw 14% month-on-month and 25% year-on-year declines, with consulting and advisory functions experiencing even steeper drops. Geographically, demand has shifted away from megacities, which saw a 17% month-on-month and 40% year-on-year decline, towards Tier 2 and Tier 3 locations, which doubled year-on-year despite an 8% month-on-month dip. Full-time work-from-office roles continue to comprise the majority of active tech openings.

India’s demand for active tech talent has hit a 28-month low due to multiple unexpected developments in and from the United States, which is its largest market.

Overall, active tech talent is on a race to the bottom again, with June’s demand outlook hitting a record 28-month low, a drop of 14 per cent month-on-month. The negative start to the new fiscal 2027, post March 26, seems to continue further and intensify going further into the first quarter. The sluggish and conservative hiring trend across all tech cohorts has further dropped, with changes in talent and enterprise contexts in the US as a key client market.

This is the biggest month-on-month (MoM) drop seen over the last 12 months. The YoY (Year-on-Year) drop of 17 per cent in demand is also a record high drop for the period. June’s active tech talent demand has dropped to the lowest level seen since January 2024. The active tech demand outlook for June 2026 is a massive 22 per cent lower than the high volume last recorded in March 2026.

H-1B pains and US-India talent movements

“Certain pools of tech talent on H-1B in the US are staring at the risk of repatriating to India with recent developments. Considering the current dynamics and trends of active demand in the Indian job market, this is definitely not the best of times for US-settled H-1B talent to return to India. After the hiring buoyancy of 2021, the Indian tech sector has not had a period of stability extending beyond a quarter. The sector continues to be periodically hit by global events and occurrences in key client markets. This is reflected in the declining trajectory of hiring action in the sector seen so far this year,” remarked Kamal Karanth, co-founder, Xpheno, a specialist staffing firm.

This expert says that the scale and pattern of tech talent moving between India and the USA have been changing rapidly over the last 3 years. “While 2-way movement of talent has been recorded every year, it is critical to observe the rise in the number of returnees over the years.

Talent corridor movements are set on a trajectory where the returnees' volume will exceed the previous year's count and further drop the net talent balance. It would not be surprising if the recent H1B move causes the returnees count to surpass the count of outbound tech talent to the US this year,” added Karanth.

As per Xpheno's Active Tech Jobs Outlook – June 2026, the Indian tech sector has not had a period of stability extending beyond a quarter. The sector continues to be periodically hit by global events and occurrences in key client markets. This is reflected in the declining trajectory of hiring action in the sector seen so far this year. “Talent corridor movements are set on a trajectory where the returnees' volume will exceed the previous year's count and further drop the net talent balance. It would not be surprising if the recent H-1B move causes the returnees count to surpass the count of outbound tech talent to the US this year,” pointed out Karanth.

The volume of active openings in the sector has remained sluggish over the last 5 quarters. The Tech Sector’s current contribution to India’s total active talent demand is 44 per cent, continuing in the sub-50 per cent mark for the 3rd month in a row. The report further points out that the demand from the IT Services cohort, as the key talent consumer, has dropped 16 per cent on a MoM basis, with a low total active volume of 36,000 openings. On a YoY basis, the current demand from the IT Services cohort is lower by 31 per cent compared to the demand seen a year ago in June 2025.

As per the report, market conditions and fresh developments continue to keep India’s IT Services cohort under stress on the talent action front. The active tech talent demand from GCCs cohort at 17,000 accounts for 18 per cent of the total active demand and has dropped 6 per cent compared to the previous month. The overall movement in GCC’s demand volume has seen a significant 31 per cent YoY rise in active tech demand from the cohort.

Interestingly, as per the report, the core Tech & Engineering functions continue to dominate active tech demand with a 55 per cent contribution. On the other hand, the demand from tech and engineering functions has dropped by 14 per cent MoM and 25 per cent YoY compared to June 2025. Associated functions like sales and marketing have dropped MoM. Similarly, the consulting and advisory function’s demand has dropped 40 per cent MoM, and 63 per cent drop over last year’s demand volume.

The report points out that geographically, 62 per cent of active tech demand is concentrated in and around the megacities collective. Despite the overall majority contribution, the volume of demand from megacities has dropped 17 per cent MoM and dropped 40 per cent YoY. The demand from Tier 2 and Tier 3 locations has dropped 8 per cent MoM but doubled YoY. The report finds that Full-time work from office (WFO) openings account for 70 per cent of all active tech openings in the market.

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