Significant AI Talent Shortage Impedes Growth in GCC Sector

Significant AI Talent Shortage Impedes Growth in GCC Sector

Synopsis

India's Global Capability Centres are grappling with a significant talent deficit in AI and data skills. This shortage, now at 38-42%, is a major obstacle to growth. The demand for advanced skills like generative AI and MLOps outstrips supply. Companies are increasingly turning to contractual hiring to fill these critical roles.

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India’s Global Capability Centre (GCC) ecosystem is facing a widening shortage of specialised AI and data talent. The gap now stands at 38-42%, making it the biggest constraint to growth, according to the fourth quarter financial year (FY)26 report by Quess Corp.

The report says this is a structural issue, not a short-term one. The biggest gaps are in advanced skills.

These include generative AI, machine learning operations (MLOps), AI observability, and large language model (LLM) fine-tuning. MLOps refers to deploying and managing AI models in real-world systems. AI observability focuses on tracking how well these models perform over time.

“There are roughly 400,000 core AI professionals in India—what we call AI builders. But demand is far higher. For every 10 open roles, there are only about six candidates available,” said Kapil Joshi, chief executive of IT staffing and recruitment.

He added that the gap is widening. “Quarter after quarter, we are seeing this mismatch increase. This is not temporary. It needs a long-term fix,” Joshi said.

The shortage goes beyond core AI roles. Companies are also struggling to hire talent in cloud, cybersecurity and platform engineering. These skills are needed to build and run AI systems, said the report.

Hiring demand is also shifting fast. About 60% of tech hiring now comes from AI, data, cloud and cybersecurity roles. This is up from around 30% two years ago.

The report further added that GCC hiring grew 12–14% in the quarter. IT services (18–22%) and BFSI (15–18%) were the top sources of talent. But shortages are pushing up salaries. In BFSI GCCs, the AI talent gap is about 42%. Companies are offering 1.5–2.5 times higher pay than traditional IT roles.

Most hiring is still in Tier-1 cities like Bengaluru and Hyderabad, which account for 88–90% of GCC recruitment. Tier-2 cities have grown to 10–12%, but lack advanced AI talent. As a result, nearly half of complex roles are moved back to metro cities, said the report.

Companies are also changing how they hire. About 25% of roles are now contractual. Firms are using this to access niche skills quickly. The contract-to-hire (C2H) model is becoming popular. It helps companies onboard faster and improves retention in specialised roles.

On the sector side, professional and shared services grew 16%, while real estate and infrastructure grew 18%. BFSI saw a 10% rise, showing renewed momentum, the report said.

Attrition remains a concern. Replacement hiring now makes up about 40% of total recruitment. This is driven by shorter job tenures, especially among younger employees, said the report.

The report further added that the GCC workforce is expected to reach 2.5-2.7 million by 2030, with over 2,200 centres in operation.

This editorial summary reflects ET Tech and other public reporting on Significant AI Talent Shortage Impedes Growth in GCC Sector.

Reviewed by WTGuru editorial team.