Up to 15% of India’s tech talent is in tier-2 and 3 cities: Report

As decentralisation of work and remote working gains momentum, many new opportunities, especially in the tech sector, have emerged. Up to 15% of India’s tech talent resides in tier-2 and -3 cities, a report by Deloitte India and Nasscom shows. For their survey, the two organisations focused on 26 tier-2 cities and found that there are about 8 lakh individuals in these cities, adept in the latest emerging tech domains.

“While big cities were the focus in the past, the post-pandemic era witnesses a remarkable decentralisation of work across the nation. Today, about 60 per cent of India’s overall graduates come from smaller towns and 30 per cent of total graduates relocate to tier-1 cities seeking employment. These locations that currently account for 11-15 per cent tech talent, provide promising growth potential when supported by the governments’ commitment to world-class infrastructure — an ‘if you build it, they will come’ approach for expansion,” said Sumeet Salwan, partner, Deloitte India

Hiring talent at these locations also offers economic benefits. The study found that in emerging cities businesses gain a 25-30% cost advantage in talent pool costs and 50% in terms of real estate rentals, as compared to mature hubs. Such advantages have led to the growing interest of global enterprise, in fact, there are over 140 global capability centres in these locations.

Beyond cost advantage, these centres are also becoming innovation hubs, the study said. Close to 40% or over 7,000 of country’s startups operate in these locations across industries like deeptech to business process management (BPM). Deloitte’s Salwan added that startups in these ‘emerging hubs’ have grown by 50% between 2014 and 2018, and are further expected to grow by 2.2 times by 2025.

Sukanya Roy, the head of GCC and BPM at Nasscom added that India is expected to have a skilled talent surplus by 2030 and that these hubs are ‘essential waypoints’ in India’s journey to become global technology powerhouse.