Tier-2 cities power India’s 2025 hiring boom as job market grows 23%

India’s job market ended 2025 on a high, clocking a robust 23% year-on-year rise in hiring activity, signalling broad-based employer confidence and steady expansion across industries. According to the latest Foundit insights tracker (fit), this surge was powered by both metro and Tier-2 cities, even as growth in the second half moderated to 4% over six months, pointing to a shift towards productivity-led and strategic hiring.

Bengaluru and Hyderabad continued to dominate as hiring hotspots, driven by technology, manufacturing and BFSI expansion. But the standout story of 2025 was the rise of Tier-2 cities such as Coimbatore and Ahmedabad, which emerged as high-growth talent hubs. Companies across tech, logistics, and consumer sectors increasingly turned to smaller cities to optimise costs, widen access to skilled professionals, and diversify their talent base.

Decentralization Dividend

“2025 shaped up as a year of strong expansion but disciplined hiring,” said Anupama Bhimrajka, VP, Marketing, foundit. “We witnessed the decentralisation of talent, with Tier-2 hubs becoming operational anchors for tech, BFSI, logistics and retail. As we head into 2026, demand for AI-ready skills, strategic leadership, and mid-career digital talent will keep momentum high despite measured intake in some sectors.”

Of the 27 industries tracked, 24 reported higher recruitment activity in 2025. Non-profits, consumer electronics, and healthcare & pharmaceuticals were among the fastest-growing sectors, reflecting a market that is expanding beyond its traditional engines of IT and BFSI. Impact-driven roles, manufacturing growth, and digital-first business models have reshaped the hiring landscape into one that is more distributed and resilient.

The demand for experienced professionals also strengthened, with 11 of 13 job functions reporting annual growth. Senior management and IT roles led the surge, driven by enterprise digital transformation and the proliferation of AI-led business models. Finance, HR, and sales hiring also picked up, underlining companies’ preference for leadership and execution capabilities to steer governance and accelerate growth.

2026 Outlook

Looking ahead, 2026 is set to be a steady but skills-driven year. Overall hiring is projected to rise by 2.3 percentage points, equivalent to around 1.28 crore new jobs, largely concentrated in the first half. Demand will remain strongest in digital, AI, cloud, data and cybersecurity, while traditional sectors such as manufacturing, BFSI, and infrastructure are expected to maintain stable momentum.

Emerging industries like fintech, health tech and electric mobility will create niche opportunities, while startups—especially in SaaS and AI-first ventures—are expected to regain selective hiring strength as funding revives. The focus, experts say, will increasingly be on mid-to-senior talent capable of leading enterprise-wide digital transformations.

Bengaluru and Hyderabad are forecast to lead 2026 hiring with 3 percentage points growth, followed closely by Mumbai, Chennai, Pune and Kochi at 2 points each. Tier-2 cities such as Coimbatore, Jaipur and Baroda are also expected to gain traction, while Delhi-NCR may remain flat—underscoring India’s gradual but firm shift toward a multi-city, skills-led talent model.

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