Over 40% of Indias IT, gig workforce uses AI tools; employability soars to 56%: Report

A recent report highlights a significant trend in India's labor market, revealing that over 40% of the country's IT and gig economy professionals are utilizing AI tools for various functions, including automation and creative tasks. This finding comes from the India Skills Report 2026, which indicates a notable rise in employability rates, now at 56.35%, an increase from 54.81% in 2025. Released by the Educational Testing Service (ETS) in collaboration with several key organizations, including the Confederation of Indian Industry (CII) and the All India Council for Technical Education (AICTE), the report draws on data from more than 100,000 candidates and 1,000 employers across seven sectors. It underscores the demographic potential of India, with an average workforce age of 28.4 years, presenting both challenges and opportunities. Notably, for the first time, women have surpassed men in job readiness. The report emphasizes the urgency for India to develop AI-ready learning environments that cater to all levels of education and professional experience. It commends initiatives like the National Education Policy (NEP) 2020 and Skill India Digital as essential stepping stones for the country's economic growth, while also calling for deeper collaboration among educational institutions, industries, and government bodies. Highlighting regional disparities, it notes that cities like Lucknow, Kochi, and Chandigarh are emerging as key employment centers, helping to bridge the skill gap between urban and rural areas. Furthermore, it reveals that female employability has reached 54%, outpacing male employability at 51.5%, largely due to the rise of hybrid work models and digital skill development programs. India is currently home to 16% of the world's AI talent, with projections estimating this number will grow to 1.25 million professionals by 2027. The report also states that over 90% of workers across various sectors are employing Generative AI tools, while 70% of IT firms and half of the banking, financial services, and insurance (BFSI) sectors have implemented AI-driven recruitment processes. With 71% of Gen Z freelancers receiving AI training, India is at the forefront of a new hybrid work model that leverages both technical skills and creative problem-solving abilities. The hiring outlook for fiscal year 2026-27 shows a promising increase in demand, particularly in technology, BFSI, manufacturing, renewable energy, and healthcare sectors. The BFSI and fintech industries alone are projected to create 250,000 new jobs by 2030, with an annual growth rate of 8.7%. Looking ahead, the report warns of a projected global labor shortfall of 85 million professionals by 2030, while India is expected to produce a surplus of 45 million skilled workers, positioning the country as a leading talent hub on the global stage.