New Delhi, Mar 10: Employer hiring intentions are strengthening heading into the second quarter of 2026, according to ManpowerGroup’s latest Employment Outlook Survey of more than 3,000 employers across India conducted from January 1 to February 3, 2026. The Net Employment Outlook (NEO) for Q2 2026 stands at 68%, up 17 points from the previous quarter and rising 24 points year-over-year, marking its strongest reading since we started tracking in Q2 2008.
India’s economic outlook remains robust, fueled by surging business confidence and resilient domestic demand. The combination of Goods and Services Tax (GST) reforms and strong economic growth projections for 2026 provides a solid foundation for businesses. Furthermore, improving trade prospects, like India-EU agreements and easing global trade tensions are set to support exports. Underpinned by these strengths, employer sentiment remains high, with widespread expectations for increased hiring.
“The India data from the Q2 MEOS & 2026 Global Talent Shortage Report presents a dual reality. Employment intent remains strong (NEO – 68%), reflecting growing employer confidence, while talent scarcity continues to intensify, with 82% of organizations reporting difficulty finding the skills they need. This underscores that today’s hiring momentum is being shaped as much by capability gaps as by business expansion,” said Sandeep Gulati, Managing Director, ManpowerGroup India and Middle East.
“Looking ahead, hiring decisions will be increasingly influenced by AI adoption and broader digital transformation. The strong intent to hire, alongside the measured deployment of AI, signals a maturing labour market – one that is balancing ambition with accountability,” said Mr Gulati. “As automation reshapes roles and learning delivers the highest return on AI investment, India is entering a phase where workforce strategy itself becomes a source of competitive advantage, evolving into an integrated model that combines targeted hiring, continuous upskilling, and technology-enabled talent management.”
The NEO across Sectors and Regional Highlights
Indian employers across all sectors anticipate an increase in staffing levels in the upcoming quarter. Compared to last quarter and this time last year, employment outlooks have improved in 8 sectors and declined in 1.
·Majority of employers (74%) anticipate an increase in hiring, while 19% expect to maintain current staffing levels, 6% anticipate a decrease, and 1% are unsure.
·The most competitive sector in India is Finance & Insurance with an outlook of 71, rising by 8 points from last quarter and 26 points since Q2 2025. Globally, India ranks first for its employment expectations in the Finance & Insurance sector, above the sector’s global outlook by 36 points.
·The sector with the greatest increase since last quarter is Utilities & Natural Resources with an increase of 22 points. This quarter is the highest outlook recorded in Utilities & Natural Resources sector for 4 years, going back to Q4 2021 when it was 73.
·Hospitality (31%) signals the most cautious hiring intentions this quarter.
·In absolute hiring volume terms, Automotive sector anticipates’ the largest net additions to headcount followed by Information and Tech & IT services.
·Indian organizations in all 4 regions anticipate an increase in staffing levels in the upcoming quarter. The most competitive region is the North with a NEO of 70, rising by 12 points from last quarter and 26 points since Q2 2025.
·The greatest growth in expectations since last quarter is reported in the East region with an increase of 20 points. This quarter has the highest outlook recorded in East for over 10 years, going back to Q3 2012 when it was 79.
·All 6 organization size types measured in the report expect increasing staffing levels in the next quarter. Employers in large organisations with 250 to 999 employees are the most optimistic, with a NEO of 71 and growing by 15 points vs last quarter. Globally, India ranks first for its employment expectations in these organizations, above the global outlook by 34 points.
AI Adoption and Workforce Strategy
Beyond hiring intentions, the survey examined how employers are deploying AI across workforce strategy, finding widespread adoption but uneven returns.
·87% of organisations are already using AI in hiring, onboarding, or training new workers. Adoption is 80% in Asia Pacific, with particularly high usage in China (95%) followed by India.
·Learning and development deliver the highest perceived return on investment from AI, cited by 40% of employers. Team performance (21%) and Talent acquisition (16%) follow.
·However, expectations remain measured. Only 11% say AI fully meets expectations in hiring and training, while 4% report no positive ROI to date. Privacy and regulatory concerns (18%), workers’ lack of AI skills (11%), challenges identifying relevant use cases and insufficient company training (9% each), are the primary barriers to broader deployment.
