India's AI Startups Surge in Hiring Amidst Talent Shortage

India’s AI startup ecosystem is on a hiring spree, bucking the broader caution gripping much of the technology job market.

As enterprises move from AI experimentation to large-scale deployment, AI-native startups and AI-first companies are ramping up recruitment across engineering, product, research and customer-facing roles, driven by surging demand for generative AI, agentic AI and enterprise automation solutions.

Recruitment and search firms said hiring mandates have surged in the past year, fuelled by fresh funding, product expansion, and growing enterprise adoption of AI.

Jobs platform foundit said AI startups are among the most aggressive recruiters, with a 21% year-on-year rise in hiring as of May, far surpassing the broader startup ecosystem’s 12% growth. Executive search firm Fidius Advisory is seeing a 35-40% jump in mandates from AI startups, while Careernet said AI-related hiring mandates are growing significantly faster than broader technology hiring.

The bullish trend is visible across companies such as Qure.ai, Observe.ai, Fractal, and Redrob AI. Executives at these firms said they are expanding teams to meet growing customer demand and support product development. Emergent, kim.cc, SymphonyAI, and Ringg Ai are among other companies accelerating hiring, said industry sources.

Experts also point to the rise of homegrown AI platforms such as Sarvam AI—the latest to join the unicorn club—as evidence of the sector’s growing momentum.

Healthtech startup Qure.ai is adding talent across AI research, engineering, product, and clinical domains to support its growing global customer base and expanding portfolio of healthcare AI solutions, said Poonam Ajgaonkar, chief people officer.

Fractal is seeing strong demand for skills spanning AI, GenAI, data engineering, cloud, product development, and consulting, as well as next-generation areas such as agentic AI, enterprise AI platforms, and industry-focused AI solutions, said Divya Bajaj, director, human capital at the AI consulting firm.

Felix Kim, CEO of AI-powered productivity and career platform Redrob AI expects a 40-50% headcount expansion over the next year. Most of the fresh hiring will be in AI/ML engineering, GenAI infrastructure, product development, and platform engineering roles.

“For organisations that are building AI-first products, talent is becoming not just helpful but more like a true strategic differentiator,” he said. “Investing in the workforce is turning into a critical component of long-term growth.”

At enterprise AI firm Observe.AI, hiring spans three distinct profiles—research engineers, application engineers, and forward-deployed engineers.

“The primary driver of our workforce expansion is enterprise customer demand,” said Swapnil Jain, CEO. “India has extraordinary AI talent, and the playing field has shifted meaningfully.”

Demand-supply gap

The hiring boom is however exposing a significant talent shortage.

Despite India’s emergence as one of the world’s largest AI talent pools, experts pointed to a continued shortage of professionals with hands-on experience deploying AI systems at scale.

“Individuals who can demonstrate evidence of building AI-powered tools and platforms are in far greater demand than those who have merely been part of larger technology or engineering teams,” said Anuj Roy, managing partner Fidius Advisory. “Being hands-on is more sought after than ever before.”

Compensation for these roles has also increased significantly, he added.

This imbalance between demand and supply is leading to hefty compensation premiums.

According to Anshuman Das, CEO, Careernet Group, mid-level AI professionals are commanding salaries 15-20% higher than peers in traditional software engineering roles, while senior AI specialists can earn 20-40% more, particularly those with proven experience building and deploying GenAI and LLM-based products.

Annual cash compensation can range from about Rs 25 lakh for early-career AI engineers to Rs 1 crore for senior individual contributors and founding engineers. Leadership hires with proven AI expertise are increasingly commanding packages of Rs 1.5 crore and more, said Das.

While AI and technology roles account for the largest share of hiring at 38%, nearly two-thirds of hiring in AI-led startups is currently happening outside core AI functions, according to Foundit data. “Demand is increasingly shifting towards consulting, product, sales, and implementation roles as startups move from building AI products to scaling adoption and commercialisation,” said Tarun Sinha, CEO of foundit.

“This suggests that the next phase of AI startup growth will be driven as much by business and customer-facing talent as by engineers and data scientists,” said Sinha.

(Catch all the Technology News News, and Latest News Updates on The Economic Times.)