India’s IT Sector Sees Significant Hiring Growth in Smaller Cities

India’s non-metro cities are experiencing a remarkable surge in hiring for software and IT roles, outpacing traditional tech hubs during the first half of 2025. According to staffing firms, cities like Udaipur, Vizag, Coimbatore, and Nagpur have seen over 50% growth in recruitment for these positions from January to June. In contrast, primary cities such as Bengaluru and the National Capital Region reported a modest growth of 12-15%. This shift in hiring trends reflects a broader transformation in India’s IT services sector, as companies increasingly turn to tier-II and tier-III cities for talent.

Growth in Non-Metro Cities

Recent data from Teamlease highlights a significant trend in India’s IT recruitment landscape. Secondary and tertiary cities are leading the charge, with Coimbatore, Nagpur, and Nasik showing annual growth rates of 20-25%. Meanwhile, Indore and Jaipur are experiencing even more robust expansion, with growth rates of 30-40%. This shift is not limited to core software roles; supporting functions in these cities have also seen an increase of 24-31%, compared to just 8-15% in primary cities. The recruitment momentum in these regional hubs has intensified, surpassing the growth seen in the post-pandemic period, indicating a sustained demand for IT professionals.

Emerging Technologies and Talent Acquisition

Mysuru has emerged as a leader among secondary cities in the recruitment of talent for emerging technologies, particularly generative AI, which accounts for 32% of its hiring in this domain. Jaipur continues to be a key player in voice and non-voice positions, while Coimbatore maintains a balanced demand across various technical roles. Cities such as Bhubaneswar, Indore, and Udaipur are also witnessing impressive growth, driven by government initiatives, investments in IT infrastructure, and the expanding presence of global tech firms. Bhubaneswar, recognized as a Smart City, is particularly notable for its growth in Knowledge Process Outsourcing (KPO) hiring, which has increased by 21% due to the rise of finance-tech platforms.

Factors Driving Recruitment Shifts

The accelerated development in these non-metro cities is attributed to several factors, including improved digital infrastructure, supportive government policies, and the widespread adoption of flexible working arrangements. Technology organizations are increasingly tapping into local talent from engineering institutions in these regions, partly due to competitive pressure from startups in primary cities. Current recruitment efforts are focused on high-demand positions such as full-stack developers, AI and machine learning engineers, cybersecurity analysts, and cloud specialists. This shift is not merely about cost savings; it represents a fundamental rebalancing of India’s talent landscape.

Future Outlook for IT Hiring

As the IT services sector continues to evolve, the hiring momentum in smaller cities is expected to persist. Neeti Sharma, CEO of Teamlease Digital, emphasizes that this trend reflects a deeper transformation influenced by hybrid work models and digital advancements across industries. Tier-II and tier-III cities are poised for sustained double-digit hiring growth, particularly in high-demand areas like AI, cloud computing, and cybersecurity. Organizations are also benefiting from operational cost savings of approximately 30% compared to primary cities, making these regions increasingly attractive for tech recruitment.

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