AI Jobs in India Surge Past Losses by 51,000, Nomura Report Shows Shift to Two-Tier Market

AI Jobs in India Show Net Positive Growth

Artificial intelligence is creating more AI jobs in India than it eliminates, according to a new Nomura report1

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. The analysis by Nomura economists Sonal Varma and Si Ying Toh documented 83,100 AI-related hiring positions between 2022 and early 2025, compared to 31,921 layoffs and attrition—more than two hires for every job lost1

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. This net positive employment impact of over 51,000 positions challenges widespread fears about mass unemployment driven by AI adoption. India's position as the world's back-office hub makes it "ground zero" for measuring AI's impact on work, with the country experiencing the largest absolute impact across both documented layoffs and AI-linked hiring in India among Asian economies1

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Technology Sectors Drive AI Job Creation Across Asia

Across Asia, the pattern strengthens further. The Nomura report identified 130,758 AI-related jobs added region-wide, with over 90% concentrated in technology sectors1

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. This compares against 60,654 positions lost, approximately 60% of those in financial services1

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. In India specifically, most new AI job creation involves data annotation and linguistics work2

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. The economists noted this finding "runs counter to the narrative of massive job losses due to growing AI adoption," with similar patterns emerging in China and the Philippines where outsourcing anchors labor markets1

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. Optimists like Nvidia's Jensen Huang have dismissed jobs-doom predictions, and the Nomura data provides concrete numbers supporting that perspective1

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A Harsh Swap Creates Two-Tier Labor Market

Beneath the positive headline numbers lies a harsh swap reshaping India's workforce. The people losing positions are primarily support teams in customer service and back-office operations replaced by chatbots, while those hired are mostly IT-services graduates that firms credit directly to AI demand1

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. "Since displaced workers rarely transition to AI engineering roles," the economists warned, "the aggregates do mask distributional pain"1

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. This creates a two-tier labor market where AI is thinning demand for entry-level workers while lifting it for experienced AI-skilled workers who grasp business contexts1

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. An ICRIER survey of 651 firms in India's IT sector revealed 55% of companies reported declining entry-level roles, compared to just 25% reporting declines in mid-level hiring and 14% in senior-level recruitment2

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Entry-Level Roles Face Automation Pressure

The junior rung—long the on-ramp into India's IT industry—is being pulled away as companies increasingly automate routine work1

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. Banking back-office operations, customer service positions, and junior technical roles such as quality assurance testing and coding are among the jobs being displaced2

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. The impact manifests through slower recruitment rather than outright layoffs. Staffing firm Xpheno estimates net hiring by Indian IT companies fell to 140,000 in FY26 from 600,000 in FY22 as companies reduced campus recruitment instead of terminating existing employees2

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. This shift threatens traditional career pathways for graduates entering the workforce.

Caveats and Future Implications

The Nomura report carries important limitations. The study rests on 69 anecdotes drawn from news reports rather than comprehensive payroll records in what Nomura describes as a fragmented labor market1

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. It represents a snapshot of a fast-moving early phase, not a definitive verdict on AI's long-term employment impact1

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. "We are positively surprised by our aggregate result showing that AI has been a net positive for jobs," the report stated, while cautioning that "there are many disruptions beneath the surface"2

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. The technology remains at an early stage, and its full labor-market impact could take years to emerge2

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. For now, in the country watching this transformation most closely, AI job creation exceeds destruction. Whether that balance holds as AI adoption accelerates remains the critical question India cannot yet answer1

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