The Impact of Artificial Intelligence (AI) on Employment

The fear of job displacement due to artificial intelligence (AI) has long been a topic of concern. Recently, the Department of Economic Affairs, under the Union Finance Ministry, highlighted this issue in its monthly economic review, noting how AI could jeopardise the careers of emerging professionals. The deployment of AI in various sectors, particularly in the IT industry, has led to the replacement of skilled employees with machines, as indicated in the September report.

The Economic Survey 2023-2024, presented in Parliament in July, also expressed serious concerns regarding employment being increasingly overtaken by AI. While the convenience and efficiency offered by AI are significant, the associated loss of human capital should not be underestimated. Although some reports suggest that AI will generate multiple employment opportunities in the tech sector, recent findings indicate a different reality.

However, freshers and professionals with little to no experience have experienced a 7% decline in job opportunities. The monthly economic review noted that the share of self-employed individuals has continued to rise in 2023-24. Additionally, industries such as oil, fast-moving consumer goods (FMCG), and gas have shown considerable growth and ongoing developments in AI and machine learning.

What options do freshers have?

Freshers seeking job opportunities in the tech and IT sectors are actively working to enhance their skills to align with the rapidly evolving technological landscape and job requirements. Many companies are favouring candidates with over five years of experience, leading freshers to pursue roles in smaller startups, often with lower salaries and challenging work-life balance. In light of the limited opportunities at major tech firms, many freshers are also considering further education or self-employment as viable alternatives.