Mumbai: A wider deployment of artificial intelligence (AI) technology by India Inc will likely make 15,000-20,000 jobs redundant this year, as a large number of coding profiles, system maintenance and support functions at junior levels get automated.

Consulting firms and recruiters emphasized that companies, specially in the IT, hospitality and banking industry are trying to upskill their workforce, but warned that the advent of AI will lead to retrenchments in the coming months, while employees play catch-up with this sophisticated technology.

“In the short run for sure, there will be a very distinct impact on jobs that are purely process-driven and can be automated, as well as jobs that require basic levels of coding or communications skills,” Anandorup Ghose, a partner at Deloitte India, said.

Ghose highlighted that the moot point is about how employers and employees are preparing their skilling agendas to meet demands from this newer technology. “We have maintained for some time now that enhancing the skilling agenda is the number one priority in India right now, given the size of the workforce, as well as the size of the opportunity. This opportunity will get missed if the workforce is not skilled to take charge of the opportunity,” he added.

Recruiters say software development and customer support roles that can be done from the backend are the most vulnerable. “We expect about 20,000 jobs to go in this year because companies are implementing chatbots in first level of interaction with the customers,” said Prasadh M.S., head of workforce research and analytics at recruitment firm Xpheno. Although the initial investments in AI will be expensive, companies will benefit in the long run, as the work done by the bots will be equal to five junior executives, he stressed.

This shift will further impact recruitments. The overall headcount growth in the IT sector in FY24 over the previous fiscal is estimated to be barely 2.4%, according to Xpheno. This tardy pace is in sharp contrast to the years just after pandemic, when the industry went on a hiring frenzy, as companies of all sizes and across sectors picked up talent in digital skills or wanted IT companies to help them grow after more than a year of muted business. In fact, the manpower growth in FY22 over FY21 was 20%.

Recruitment firm TeamLease has seen the impact of AI-led skills on mandates that are rolled out by IT companies. “The mandates now have demand for fewer candidates from the client’s end as larger portions of the job are digitised. We estimate about 15,000 job loss in the IT sector, amongst the junior profiles,” said Sunil Chemmankotil, chief executive officer for TeamLease Digital.

However, AI is also expected to create new jobs, as more companies manage to upskill the workforce.

Ashish Kumar Singh, chief human resources officer at e-commerce firm Meesho, said that it is the call centres where a lot of the customer support work is done by AI. Meesho partners with third parties for its call centre services and some aspects of the calls and first-level chats with customers are undergoing AI implementation.

“There are places around analytics and first-level coding where the evaluation is still on …It will mostly be used as a co-pilot in supporting somebody. Immediate job losses I don’t see, but over a very long term, yes,” Singh told Mint.



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