Everyone is talking about artificial intelligence and how we must master it to be job-ready. As companies adopt and integrate AI to stay competitive and drive innovation, the demands on emerging talent continue to grow. This begs the question: Are Indian graduates equipped with the skills needed to thrive in today’s AI-driven workplaces?
The latest India’s Graduate Skill Index 2025 report by Mercer | Mettl indicate that the overall employability of Indian graduates has declined slightly, dropping from 44.3% in 2023 to 42.6% in 2024. However, this decrease was mainly due to lower employability in non-technical roles, whereas technical roles have experienced an upward trend.
Notably, 46% of graduates are now employable in AI and machine learning positions, showcasing a significant improvement in proficiency in these technical skills.
The report also projects that India’s AI market will reach $17-22 billion by 2027, growing at a CAGR of 25-35%.
In the report, Siddhartha Gupta, president of Mercer India, mentions, “Technical proficiency in AI and data analytics is no longer a niche requirement; it has become fundamental across various sectors. Graduates must embrace a mindset of continuous learning, equipping themselves with the tools to navigate this evolving landscape.”
What Does The Indian Graduate Scene Look Like?
Several factors contribute to the decline in employability for non-technical roles, including a less structured learning path for non-technical skills and the rapid change in employer expectations.
When it comes to technical skills, UI/UX skills come a close second to AI-ML, with back-end developer skills taking a backseat (as evident in the infographic above). The report further reveals that the employability gap between technical and non-technical roles varies across college tiers.
Tier 1 colleges exhibit the highest employability for both types of roles, while tier 2 and tier 3 colleges display high proficiency in technical roles but lag behind in non-technical skills.
This disparity underscores the need for a more inclusive approach to skills development that caters to the diverse needs of graduates from different educational backgrounds. However, the difference is not huge, which means tier 2 and tier 3 colleges have good potential.
Furthermore, male graduates have a marginally higher employability rate overall and in technical roles than their female counterparts. However, women graduates exhibit higher employability in certain non-technical roles, such as digital marketing and human resources.
“About 43.4% of male graduates who apply for jobs are employable, while employability is 41.7% for the females,” the report states.
Interestingly, 70% of current Indian college students are looking forward to joining IT companies. While the IT industry saw a slump in the number of graduates hired, industry experts anticipate a turnaround in the near future.
But what is the reason behind this gap?
In an interview with AIM, Ankit Anand, founding partner at Riceberg Ventures, highlighted, “The talent pool here is extremely limited even though IITs churn out around 10,000 engineers a year.”
In a report about Indian CS graduates, a developer previously told AIM that despite the saturated market, he struggled to find a job due to insufficient skills. He mentioned having to undertake unpaid internships for over a year because universities did not teach the skills that the employers demanded.
Hence, a close collaboration between the industry and academia is crucial to improving the skill set of Indian graduates.
Mind the Gap
The Graduate Skill Index 2025 report paints an elaborate picture of the employability landscape for Indian graduates. While the growing proficiency in AI-ML skills is encouraging, the decline in non-technical skills and the persistent gap between technical and non-technical roles raise concerns.
Soft skills are one of the contributing factors to ensuring better chances in the AI-augmented job world. To prepare for the future of work, educational institutions, industry leaders, and policymakers need to work together to cultivate a workforce that is not only skilled but also adaptable and resilient.
This focus needs to be on strengthening the curriculum for technical and non-technical skill development, promoting a culture of continuous learning and upskilling, monitoring the requirements of in-demand skills and updating the curriculum accordingly.
Companies can also make a difference by helping fresh graduates upskill quickly. Sami Atiya from ABB, an industrial robot supplier and manufacturer, shared insights into ABB’s hackathons and training programs, including a recent initiative in India that trained 2,000 employees on AI on the same day and generated over 200 new AI use cases.
The digitally savvy youth in India have access to online resources, courses, and distance learning materials to upskill. This could mean better upskilling opportunities. By addressing these challenges and investing in the development of a well-rounded workforce, India can ensure that its graduates are not just job-ready but future-ready.
