Your next great hire probably isn’t sitting in a Bengaluru co-working space anymore. They’re in Indore, Jaipur, or Coimbatore — and if your hiring funnel still assumes otherwise, you’re already losing candidates to companies that caught on first.
The data backs this up, and it’s moving fast. Tier-2 cities are no longer overflow capacity for Indian employers — they’re becoming first-choice locations for long-term workforce planning, driven by lower operating costs, improving infrastructure, and a deepening skilled-talent poolas companies increasingly treat these cities as first-choice locations for long-term workforce planning rather than overflow capacity. Industry forecasts now put tier-2 cities at roughly a third of all new job creation in India by 2026with tier II cities projected to account for 32% of new jobs by 2026. Substack
The AI hiring boom makes the shift even starker. While Bengaluru still leads in raw volume, its year-on-year AI hiring growth is being outpaced by emerging hubs — Jaipur, Indore, and Mysuru are all posting significantly faster tier-2 growth rates than Bengaluru’s own expansionBengaluru retained leadership with a 26 per cent share of AI jobs, growing 32 per cent year-on-year, while Jaipur, Indore, and Mysuru led tier II gains. On the BPO/ITES side — often the entry point into a company’s talent pipeline — Jaipur’s hiring volume has been growing dramatically faster than metro benchmarks in recent monthsJaipur posted a 66% year-on-year increase in BPO/ITES hiring in January 2026. careers360naukri
What this means for your funnel:
If your job postings, interview logistics, and salary bands are still metro-anchored, you’re filtering out exactly the candidates now driving India’s hiring momentum. Three things to fix this quarter:
- Rewrite location assumptions in your JDs. “Bengaluru-based” requirements quietly kill applications from qualified tier-2 candidates who’d take the role remote or hybrid.
- Rebenchmark compensation by cost-of-living, not city prestige. Tier-2 candidates aren’t asking for metro salaries — they’re asking not to be penalized for skipping the commute.
- Speed up your interview cycle. Tier-2 talent pools are thinner and move faster once identified; a slow process loses them to a competitor’s offer.
Companies that adapted their sourcing strategy early are already seeing it pay off. The ones still waiting for tier-2 hiring to “prove itself” are competing for a shrinking pool of Bengaluru talent everyone else has already interviewed.