Hiring intentions among Indian employers have significantly improved for the second quarter of 2026, with the net employment outlook (NEO) reaching a record high level. The NEO for Q2 (April-June) stands at 68%, marking a 17-percentage point increase from the previous quarter and a 24-point rise year-on-year (YoY). Businesses are benefiting from tax reforms under the Goods and Services Tax (GST) regime and optimistic economic growth expectations for 2026.
The finance and insurance sectors have reported the strongest hiring outlook at 71%, showing an 8-point increase from the previous quarter and a 26-point rise YoY. Additionally, the utilities and natural resources sector experienced a significant quarterly improvement, with the outlook increasing by 22 points, reaching its highest level in four years since Q4 2021.
Hospitality, on the other hand, has the most cautious hiring outlook at 31%. In terms of job creation, the automotive sector is expected to lead in net addition to headcount, followed by information technology and IT services. Sandeep Gulati, Managing Director of ManpowerGroup India and the Middle East, mentioned that while employment intent remains strong, talent scarcity is intensifying, with 82% of organizations facing challenges in finding the required skills.
The North region has reported the strongest hiring outlook with an NEO of 70, marking a 12-point increase quarter-on-quarter (QoQ) and a 26-point rise YoY. The East region saw a notable quarterly improvement, with expectations rising by 20 points, reaching its highest level in over a decade since Q3 2012. Across various company sizes, employers are optimistic, with all organization-size categories anticipating staffing increases. Large organizations employing 250-999 workers are particularly optimistic, with an NEO of 71, up by 15 points from the previous quarter.
The report also highlighted that about 87% of organizations are already utilizing AI in hiring, onboarding, or training employees. The Asia-Pacific region has an 80% AI adoption rate, with China leading at 95% and closely followed by India.
