Smaller cities outpace tier-1 in job creation: Report

Tier-2 and tier-3 cities are emerging as faster-growing job markets, with postings rising 16.1% and 30.6%, respectively, in Q1FY27, outpacing the 7.3% growth recorded in tier-1 markets, according to an analysis by AI-native early-career talent platform Apna.

As India completes 79 years of independence, Apna released its Bharat@79 report, which examines how employment ecosystems across India are changing.

“Tier-1 markets continue to account for most hiring demand, but the pace of growth points to a broader dispersion of opportunity and the emergence of India’s next employment centres,” it said in a statement.


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Emerging cities led the momentum, with job postings in Guwahati rising 48.4% YoY, Varanasi 41.7% and Dehradun 28.5%, according to the company.

“India’s employment story can no longer be understood through a handful of large cities. Opportunity is spreading into emerging markets, while AI is changing the skills required within everyday jobs,” said Kartik Narayan, CEO, Apna.

“The next phase of India’s workforce growth will depend not just on where jobs are created, but on how effectively emerging talent markets can connect to them.”

Quick commerce, supply chain, manufacturing and operations are among the areas seeing strong demand, according to the analysis. Quick commerce stood out, with job postings growing 60.3% YoY.

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Gen Z drives hiring activity

Gen Z accounted for 72.9% of applications in Q1FY27, according to the findings. Participation was particularly strong in tier-2 markets, where Gen Z employee engagement stood at 59.4%, ahead of 56.0% in tier-1 markets.

AI is increasingly becoming a capability embedded in mainstream work. Postings seeking AI skills grew 112.4% YoY in Q1FY27.

“Much of this demand is appearing within roles such as video editing, graphic design, digital marketing, business development and teaching, rather than only through the creation of standalone AI jobs,” the company said.

The report looked beyond where jobs exist today to track shifts in employer demand, candidate participation, wages, the nature of work and the readiness of different markets for what comes next.