AI skills overtake traditional engineering and IT capabilities in India

AI skills have overtaken traditional engineering and IT capabilities for the first time to become the most difficult skills for employers to find, a report showed on Friday.

Over eight out of 10 employers or 82 per cent of employers cited in India reported difficulty finding skilled talent in 2026, according to the report from ManpowerGroup.

AI literacy and AI model development emerge among the hardest skills to find, the report said, adding that talent pressure has increased compared to last year and remains significantly above the global average of 72 per cent.

“The most difficult skills to source worldwide include AI literacy, and AI model development, engineering, sales and marketing and manufacturing & production - underscoring that AI capabilities are now universally scarce,” the report said.

India ranked among the most talent-constrained markets globally, alongside countries such as Slovakia (87 per cent), Greece (84 per cent), and Japan (84 per cent).

The research, covering over 39,000 employers across 41 countries, revealed a modest relief in global hiring at 72 per cent vs 74 per cent in 2025, which has been offset by fierce competition for AI capabilities.

It also highlighted a widening structural skill mismatch as organizations struggle to secure both advanced technical expertise and essential soft skills.

“India’s talent shortage at 82 per cent signals a structural transformation in the labour market rather than a cyclical one,” said Sandeep Gulati, Managing Director, India and Middle East, ManpowerGroup India.

Employers’ responses varied with around 37 per cent prioritising upskilling and reskilling, 35 per cent targeting new talent pools, and 26 per cent offering greater schedule and 25 per cent providing location flexibility, the report further said.

The talent challenge spread across industries with those facing the most strain include – automotive (94 per cent), information & finance or insurance (85 per cent), professional, scientific, and technical services or construction and real estate or tech and IT services (84 per cent).