Location strategy

How to choose a Tier 2 city for tech hiring in India

More companies are hiring outside Bengaluru, Hyderabad, Pune, Chennai, Mumbai and NCR. Tier 2 cities can lower cost and attrition, but only if the city has the talent your roles need. Use these seven factors to compare options.

1. Talent supply for your specific roles

Look beyond total graduates. Check the number of engineering and technical graduates each year in the skills you need, plus the experienced professionals already working in the city. A city with many freshers but few senior engineers suits a different team shape than one with mid-level depth.

2. Competition for that talent

Count the employers already hiring the same roles in the city: IT services firms, product companies and global capability centres (GCCs). A cheaper city with intense competition can lose its cost advantage within a few years.

3. Total cost, not just salary

4. Attrition and stability

Smaller markets often have lower attrition because there are fewer competing employers, but this can change quickly once larger employers arrive. Track the trend, not a single year.

5. Infrastructure and connectivity

  • Direct flights to your headquarters and major client locations.
  • Availability of IT parks, SEZs and quality office space.
  • Power and internet reliability, and quality of life factors that help recruit people from outside the city.

6. State government incentives

Many states publish IT or GCC policies with incentives such as capital subsidies, rental support or stamp-duty reimbursement. Check the current state policy, and compare incentives with total cost over five years rather than year one.

7. Leadership talent

Senior leaders are usually the hardest hires outside the metros. Plan to relocate a few anchor leaders, or run a hub-and-spoke model where leadership sits in a metro.

Score your shortlist

FactorWeight (example)How to measure
Talent supply for your roles25%Graduates and experienced professionals in your skills
Competition for talent15%Employers hiring the same roles
Total cost20%Pay, space, travel, replacement cost
Attrition trend15%Multi-year attrition for comparable roles
Infrastructure10%Flights, office supply, reliability
Incentives5%Current state policy, over five years
Leadership talent10%Senior hires available locally

Adjust the weights to your situation. A delivery centre hiring freshers will weight supply and cost higher; a product engineering hub will weight leadership talent and competition higher.

Compare cities with data

Kynoa's talent mapping by city compares hiring cost, talent supply and attrition across 42 Indian cities, so you can shortlist with evidence rather than anecdote.

Frequently asked questions

Which cities count as Tier 2 for tech hiring?

There is no official list. In tech hiring, Tier 2 usually means cities outside the six major metros with a growing technology workforce, such as Jaipur, Indore, Kochi, Coimbatore, Ahmedabad, Chandigarh and Bhubaneswar.

Should we move existing teams or hire new ones in a Tier 2 city?

Most companies start new teams there and relocate a few anchor leaders, rather than moving existing teams. That avoids attrition from forced relocation.

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