India’s IT services industry is witnessing a slowdown in hiring since the start of the second quarter, a trend that staffing firms expect will continue amid global economic uncertainties, higher US tariffs and weaker discretionary spending.According to ET, data from Teamlease showed a 10% drop in overall hiring across India’s $283-billion outsourcing sector between July and August. In the current quarter ending September 30, demand for legacy tech jobs has fallen by 2–3%, though roles in artificial intelligence (AI), machine learning (ML), cloud, data and cybersecurity remain strong. In comparison, the June quarter had recorded a 3% year-on-year increase in headcount, with net additions of around 9,000 employees.Job additions at the top six IT firms, including Tata Consultancy Services (TCS) and Infosys, stood at just over 3,800 during the June quarter, nearly 72% lower than the March quarter, as per ET. Xpheno’s data showed active openings for legacy tech jobs fell to 43,000 at the end of August, down 9% from July and 24% lower year-on-year, marking a 41% fall from September 2022.“The demand volume is fast approaching its lowest point in three years, and there aren’t any immediate or clear signs of a turnaround,” Xpheno cofounder Kamal Karanth was quoted as saying by ET.Teamlease Digital CEO Neeti Sharma said the divergence in hiring trends is clear: “Companies are hiring in higher numbers for skills in cloud, data, cybersecurity and AI/ML coding, while the legacy tech stacks are not being hired for. Hence, the dip in hiring.”Kapil Joshi, CEO of IT staffing at Quess Corp, highlighted that August saw nearly a 20% drop in demand compared with July. He attributed this to “macro factors, including additional US tariffs and global economic uncertainties, which have made enterprises more cautious with their hiring plans.”The September quarter is expected to close weaker than anticipated, while the October–December period could also remain muted due to festive breaks in India and holidays in the US and Europe.Still, demand for emerging tech roles is surging. Teamlease noted that India requires more than 500,000 AI-skilled professionals but has only one qualified engineer for every 10 open roles, pushing salaries sharply higher, particularly in GenAI and cybersecurity.