Jobs and Employment

Lull in entry-level tech jobs continues; can India’s non-tech sectors compensate?

Sohini Mitter

June 03, 2024 | 9 Min Read

After hitting two-decade lows in FY24, new job creation in core tech and engineering continues to show muted growth as IT firms and startups trim post-pandemic hiring excesses. While green shoots of hiring activity can be seen in traditional sectors like banks, consumer and retail, is it enough?

Key Takeaways

Entry-level jobseekers—those with 1-3 years of experience—are finding it challenging to get roles with decent pay packages as recruiters opt for mid-level talent to save on training costs
About 26 lakh entry-level jobseekers (including freshers with no work experience) were looking for active openings in the last 30-day period, per industry estimates
Negative net hiring in the IT sector in FY24, coupled with mass layoffs in Big Tech globally, has led to oversupply of tech talent in the Indian market
Tech attrition is down from 32% two years ago to 7-8% now, with companies lowballing entry-level candidates until they settle for below-par pay

It’s not the proverbial lull before the storm, but the one after it.

Following a pandemic-induced hiring frenzy in 2021 and early 2022, the golden tap of tech jobs in India has run dry in the last 12-15 months. New employment generated in core tech and engineering sectors hit a two-decade low in FY24, with legacy IT companies drastically cutting down on hiring. Even startups, which absorbed a fair share of tech talent post the VC funding highs of 2021, have tempered their recruitment plans.

What’s unfolding is quite the white-collar job crisis. There have been record low levels of placements in the IITs—a story that has been well-documented by now—sending chills down the spine of the country’s education system.

“India's fancy education sector is riding on the back of the IT industry. And in the last 20-25 years, the IT industry’s headcount never went down. So, this is a definite problem area, and the next few years will be difficult,” the head of a recruitment agency tells The CapTable.

“The question is: How will the [high] volume jobs be created? Will we be able to create half a million engineering jobs in FY25?” he asks.

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