Mumbai , June 10 : Organizations and their people are operating under sustained uncertainty driven by rapid AI adoption pressures and a deepening talent crunch, according to the 2026 People Risks report released today by Marsh , a global leader in risk, reinsurance and capital, people and investments, and management consulting. India’s people risk profile mirrors global trends, with technology concerns forming 4 out of top 10 people risks.
Drawing on insights from more than 4,500 HR and Risk professionals across 26 markets, including 311 participants from India (comprising 155 HR and 156 Risk professionals) the report highlights that technology disruption, rising economic pressures and shifting talent dynamics are reshaping the enterprise risk landscape.
Within India, these workforce-related vulnerabilities directly impact organizational resilience and business performance Specifically, mindset barriers to AI adoption is now among the top people risks for Indian organizations. (nearly half (49%) of organizations concerned about investing in AI without appropriate employee training) and inadequate cyber threat literacy ranks third (ranked #3; with 52% concerned about a lack of awareness regarding digital risks and mitigations). While increasing health and benefit costs remain a concern, organizations reported that focusing only on technology and capital investment without parallel investment in people – will blunt the value of AI initiatives.
India’s people risk profile also features labor shortages, specialized technology skills gaps, and employee financial insecurity. Concerns regarding transparency, fairness, and inclusion, alongside a shifting regulatory environment, mental health deterioration, and poor management of investment risk in benefit programs round out the top ten threats.
Organizations that address these pressures holistically are better positioned to gain a competitive edge. Globally, 53% of respondents reported higher workforce productivity and efficiency, and 51% saw faster progress on strategic initiatives when people risks were effectively managed.
“People risks in India can no longer be treated as secondary concerns, they are directly shaping business outcomes. From the growing expectations gap between employers and employees, to the cyber vulnerabilities created by human behavior, to the productivity lost to AI anxiety and skills gaps, these challenges sit at the heart of how Indian organizations will perform and compete. In 2026, resilience depends on how intentionally organizations invest in their workforce building digital capability, closing the expectations gap, and ensuring their people are equipped to navigate an increasingly complex environment” said Sanjay Kedia, CEO and President, Marsh India.
Key Findings for India:
Benefits inflation is redefining India’s rewards strategy
Increasing health and benefit costs are India’s number one people risk, with 65% of HR and Risk professionals expecting costs to rise over the next one to two years. Employers play a pivotal role in the healthcare system: 96% of employees trust their employer to provide access to affordable, quality healthcare and 54% depend on their employer for medical coverage. Yet 41% of respondents say benefit decisions are made without considering long-term cost impact and 40% say they are made without adequately considering the health and financial impact on employees.
Rising attention on talent gaps and leadership strength
Labour shortages are the top concern for HR professionals in India and fourth overall, reflecting sustained pressure to attract, retain and develop critical skills in a market marked by pronounced skills mismatches. Inadequate supervisory and leadership skills emerge as India’s most powerful risk multiplier: 62% of respondents say it would have a catastrophic or high impact on their organization, triggering or worsening issues such as mental health deterioration, misconduct and unsafe working conditions. Yet only 46% report having highly effective leadership assessments in place. At the same time, lack of transparency, fairness and inclusion features within India’s top five risks, more prominently than in the global rankings, signalling how leaders behave and how fairly people are treated have become measurable business risks.
Digital ambition is outpacing skills, cyber awareness and AI readiness
Specialized technology skills shortages rank sixth in India, underscoring a widening gap between digital ambition and workforce capability. For Risk professionals, inadequate cyber threat literacy is the single biggest people risk, highlighting that cyber resilience depends as much on human behaviour as on technology. Indian organizations are investing heavily in AI, but many respondents question whether this investment is matched by workforce readiness: 52% of HR and Risk professionals are concerned about limited knowledge of AI risks and mitigations, 49% say their organizations are investing in AI without adequate employee training and upskilling, and 43% flag employee resistance due to fear of job loss or change fatigue as a distinct and growing risk. “AI is reshaping work at an unprecedented pace, but technology alone will not deliver value – people will. In India, employers risk losing the full potential of their AI investments if they overlook the human dimension. Building confidence, communicating clearly and investing in reskilling are not optional — they are the foundation of resilient AI adoption and sustainable business performance” said Prawal Kalita, Managing Director and India Leader, Mercer Marsh Benefits.
Well-being and workplace safety are shaping long-term performance
Employee financial insecurity ranks eighth overall in India and is identified as a direct trigger for weakened retention and engagement, workplace misconduct and reduced cyber vigilance. Mental health deterioration also ranks among India’s top people risks, yet it is often overshadowed by more visible threats. More than half (54%) of HR and Risk professionals in India are concerned about limited support for employee mental health and emotional well-being at work, and 41% say risks related to unsafe physical and/or psychological working conditions would have a catastrophic or high impact on their organization. The findings underline that employees cannot perform, adapt or innovate if they are unwell or feel unsafe, and that sidelining health and well-being carries significant long-term costs for performance and resilience.
Stronger HR–Risk alignment is emerging as a critical differentiator
Organizations that report more advanced risk management practices in India also report more effective mitigations across their people risks, from cyber resilience and benefits governance to leadership capability and workforce health. Where HR and Risk functions work closely together, decision-making is stronger and organizations are better equipped to navigate external shocks and ongoing disruption. In India, 40% of HR and Risk professionals say their functions fully collaborate, 44% report partial collaboration and 16% report minimal collaboration, highlighting both meaningful progress and a significant opportunity to further strengthen governance and turn people risk management into a source of competitive advantage.