Generative AI to Transform 38 Million Jobs in India by 2030, Boosting Productivity and Economic Growth

GenAI to transform 38 million jobs in India by 2030, boost productivity: EY report

GenAI could transform 38 million jobs in India by 2030, boosting economic productivity by over 2.6%. Key sectors like financial services, healthcare, and retail will see significant changes. However, talent shortages pose challenges, with only 3% of enterprises equipped to fully utilise AI. Falling AI costs are aiding adoption, positioning India as a potential global AI leader.Generative AI (GenAI) is set to revolutionise India's workforce by transforming 38 million jobs and driving substantial economic growth by 2030, according to a report by EY India. The report highlights that GenAI adoption could enhance India's economic productivity by 2.61% in the organised sector, with an additional 2.82% boost achievable if adopted widely by the unorganised sector. The report identifies immense potential for GenAI across industries, with 24% of tasks fully automatable and another 42% improvable through AI augmentation. This could save 8-10 hours per week for knowledge workers, enabling them to focus on higher-value activities. The services sector is expected to benefit the most due to its high labour share in gross output. Financial services, healthcare, and retail are predicted to see significant transformations in processes such as customer acquisition, operations, and service. Meanwhile, IT/ITeS and BPO sectors will undergo substantial changes. However, industries like auto and pharma may see limited productivity gains, with a marginal increase of around 2%. Among specific business processes, call centre management is projected to achieve up to an 80% productivity boost, while software development could see a 61% increase. Content development and distribution may grow by 45%, customer service by 44%, and sales and marketing by 41%. The report underscores a significant hurdle in the form of talent shortages. Only 3% of Indian enterprises currently possess sufficient in-house talent to fully utilize AI capabilities, while 97% of executives identify the lack of skilled talent as a critical barrier. Rajiv Memani, chairman and CEO of EY India, said "GenAI is unlocking unprecedented opportunities across sectors, fundamentally reshaping jobs and driving innovation. To harness this potential, building talent pipelines and prioritizing upskilling must be at the forefront of every organisation's agenda." Despite its promise, GenAI adoption in India remains in its early stages. The survey found that only 15% of enterprises have implemented GenAI in full-scale production, while 34% have completed proof-of-concept (POC) projects and 11% are working on successful POCs. A significant 36% of surveyed enterprises have yet to commence any experimentation. While talent remains a challenge, falling AI deployment costs are helping ease adoption barriers. Mahesh Makhija, Technology Consulting Leader at EY India, said, "With falling costs and better ROI frameworks, India has an opportunity to position itself as a global leader in AI. By addressing challenges in governance and intellectual property, the country can amplify its economic growth and become a hub for AI-driven innovation." The report notes an 80% reduction in foundational AI model costs over the past two years. Small and medium enterprises (SMEs), in particular, stand to benefit, with deployment costs now as low as Rs120 per hour, making AI increasingly accessible.

GenAI set to revolutionise 38 million jobs in India by 2030, unlocking significant productivity gains: EY India report

By 2030, Generative AI (GenAI) is expected to significantly transform India's workforce and economy, potentially revolutionizing 38 million jobs, boosting productivity by up to 5.43%, and addressing talent shortages through skill development. Adoption challenges and early-stage implementation remain critical hurdles.Generative AI (GenAI) is poised to reshape India's workforce and economic landscape by 2030, according to the EY India report, 'How much productivity can GenAI unlock in India? The AIdea of India: 2025'. The report predicts that AI adoption could transform 38 million jobs, driving a 2.61% productivity boost to the Indian economy through gains in the organised sector. An additional 2.82% productivity increase could be achieved by extending GenAI adoption to the unorganised sector. GenAI has the potential to revolutionize every job, unlocking significant productivity and economic benefits, said the report. The report highlights that 24% of tasks across industries are ripe for full automation, while another 42% can be augmented by AI, freeing up 8-10 hours per week for knowledge workers. The services sector is expected to see the largest productivity gains due to its higher labor-to-output ratio, while manufacturing and construction will experience a more modest impact. Talent Shortages and Adoption Challenges Based on a survey of over 125 C-suite executives, The EY report reveals that a lack of skilled talent remains a critical barrier to AI adoption. Only 3% of Indian enterprises have the in-house expertise and resources to fully leverage AI, while 97% of executives identify talent shortages as a primary obstacle. Rajiv Memani, Chairman and CEO of EY India, said "GenAI is transforming India's economic landscape by unlocking unprecedented opportunities across sectors. This revolution will fundamentally reshape jobs, driving productivity and innovation. Building talent pipelines and prioritising upskilling must be at the forefront of every organisation. Through public-private collaborations and investments in talent development, India can emerge as a global hub for AI-skilled talent." Mahesh Makhija, Technology Consulting Leader at EY India, added, "In sectors like financial services, healthcare, and retail, AI will redefine core processes such as customer acquisition, operations, and service delivery. Meanwhile, IT/ITeS and BPO industries will undergo more dramatic transformations. Next-generation industries like biotech, advanced manufacturing, and renewables have the potential to leapfrog to AI-first business models. To maximize economic growth, India must focus on AI policy, compute infrastructure, research, and address challenges in governance, intellectual property rights, and data protection." From POCs to Production: The State of AI Adoption While the potential of AI is vast, adoption remains in its early stages. Only 15% of surveyed enterprises have implemented GenAI in production, with 34% having completed proof of concepts (POCs) and 11% working on scaling successful POCs. However, 8% of those who experimented with GenAI faced challenges in achieving tangible impact. A significant 36% of enterprises have yet to begin any experimentation, highlighting the nascent stage of adoption. Data readiness also varies widely among Indian enterprises. Only 3% report being fully prepared for AI deployments, while 23% admit they are in no state of data readiness to undertake such initiatives. Sector-Wise Productivity Gains EY's analysis of over 10,000 tasks across industries reveals varying productivity impacts. Call center management is expected to see an 80% productivity boost, followed by software development at 61%. Other sectors with significant gains include content development and distribution (45%), customer services (44%), and sales and marketing (41%). IT/ITeS is projected to see a 19% productivity increase, healthcare 13%, and banking/insurance 8-9%. Meanwhile, auto and pharma sectors may experience a marginal 2% boost due to their limited labor contribution to gross output. To assess GenAI's impact, tasks were evaluated based on three criteria: exposure (potential impact of GenAI), complementarity (level of human oversight required), and intensity(frequency of tasks). A 'Productivity Uplift' Indicator was developed to quantify potential impacts in terms of automation(task elimination), augmentation(improving task performance using GenAI), and amplification (enhancing task complexity and value). Focus on ROI and Falling AI Costs Measuring Return on Investment (ROI) is critical for GenAI adoption. However, the survey reveals that Indian enterprises struggle to fully measure and allocate AI-related costs. Among the 15% of enterprises with GenAI workloads in production, only 8% (about half) can accurately measure and allocate these costs. This underscores the need for systematic methods to predict costs and measure AI's impact before broader adoption can occur. On a positive note, the cost of AI deployments has declined significantly, driven by the open-source movement and the use of purpose-specific small language models (SLMs). The report highlights an 80% drop in foundational model API prices over the past two years, making AI more accessible. With deployment costs as low as INR 120 per hour, AI is becoming increasingly viable, especially for small and medium enterprises.

Generative AI to Transform 38 Million Jobs by 2030: EY India Report

GenAI deployment costs have dropped significantly, making AI more accessible for small and medium-sized enterprises. Generative AI (GenAI) adoption could transform 38 million jobs by 2030, according to an EY India report. GenAI will drive a 2.6 percent productivity in the Indian economy through gains in the organised sector and has the potential for an additional 2.8 percent in the unorganised sector, according to the report titled 'How much productivity can GenAI unlock in India? The AIdea of India: 2025'. Also Read: Most Indian CFOs See GenAI Enhancing Tax Efficiency, EY Survey The EY India report, released on January 14, 2025 said, "GenAI is poised to transform every job, unlocking immense potential for productivity, and economic gains." According to the report, 24 percent of tasks across industries have the potential for full automation, while another 42 percent can be enhanced through AI, potentially freeing up between 8-10 hours per week for knowledge workers. At an industry level, the largest productivity gains are expected in the services sector due to its higher labour share to gross output, while manufacturing and construction will see a smaller impact. Only 3 percent of Indian enterprises possess sufficient in-house talent and resources to make the most of what AI has to offer, while the remaining 97 percent of executives cite lack of talent as a primary hurdle, according to the findings based on a survey of over 125 C-suite participants. Also Read: Gen AI and Quantum Computing to Generate 10 Lakh Jobs by 2030: Report Rajiv Memani, Chairman and CEO, EY India, says "GenAI is transforming India's economic landscape by unlocking unprecedented opportunities across sectors. This revolution will fundamentally reshape jobs, driving productivity and innovation. Building talent pipelines and prioritizing upskilling must be at the forefront of every organisation. By fostering public-private collaborations and investing in talent development, India can also become a global hub for AI skilled talent." The survey reveals that adoption is still in its early stages. Only 15 percent of surveyed enterprises have implemented GenAI in production, with 34 percent having completed proof of concepts (PoCs) and 11 percent working on making POCs successful. About 8 percent of those who have experimented with GenAI report facing challenges in realising a tangible impact. On the other hand, around 36 percent of survey participants have yet to commence any experimentation, reflecting the early stage of adoption. Enterprises in India are also at different stages of data readiness. Only 3 percent of surveyed enterprises report being fully ready, with 23 percent reporting that they're in no state of data readiness to take up AI deployments. Discussing survey findings, Mahesh Makhija, Technology Consulting Leader, EY India, said, "In industries like financial services, healthcare and retail, AI will reshape basic processes including customer acquisition, operations and service, while IT/ITeS and BPO will undergo more dramatic changes. Next-generation industries like biotech, advanced manufacturing and renewables will have the potential to leapfrog to AI-first business models. To maximise the potential for economic growth, India needs to focus on AI policy agenda, compute infrastructure, AI research, addressing challenges in responsible governance, intellectual property rights, and data protection." Also Read: AI-Driven Transformation to Add 33.9 Million Jobs to India's Workforce by 2028: Report EY's analysis of over 10,000 tasks across industries shows varying productivity gains across sectors. Amongst the business processes to see the most impact are call centre management, which is likely to witness an 80 percent productivity enhancement, and software development with a potential for 61 percent growth in productivity. Content development and distribution had 45 percent, followed by customer services at 44 percent, and sales and marketing at 41 percent. Productivity boost in IT/ITeS is expected to be around 19 percent, followed by healthcare at 13 percent and banking/insurance at 8-9 percent. According to the report, being able to measure Return on Investment (ROI) is critical for GenAI investment decisions. EY says its survey of Indian enterprises also points to an inability to fully measure and allocate AI-related costs. Of the 15 percent of Indian enterprises that report having GenAI workloads in production, only 8 percent (about half) report being able to fully measure and allocate AI costs. The survey highlights the need for a systematic means to predict the costs of, and measure the impact of, AI before we see greater adoption, EY said. Also Read: Meta Says Open-Source AI Is Transforming Healthcare Outcomes At the same time, the cost of AI deployments has fallen, driven by the open-source movement and the trend to use purpose specific small language models (SLMs). The report identifies cost reductions, such as an 80 percent drop in foundational model API prices over the past two years, as a critical enabler for broader adoption. With deployment costs as low as Rs 120 per hour, AI is becoming increasingly accessible, especially for small and medium enterprises, the report noted. Also Read: India Leads in AI Adoption, Outpacing Global Average, Says BCG Report EY said the survey was designed to reflect the breadth of Indian business sectors, including financial services, retail, healthcare, life sciences, media and entertainment, technology, automotive, industrials, and energy.