India About 3 million people to lose jobs in Indian...

About 3 million people to lose jobs in Indian IT sector: Report

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With automation taking place at a much faster pace across industries especially in the tech space, Indian software firms that employee over 16 million people are set to slash headcounts by a massive 3 million by 2022, which will help them save a whopping $ 100 billion mostly in salaries annually, says a report.

According to Nasscom, domestic IT sector employs around 16 million, of them around 9 million are employed in low-skilled services and BPO roles. Of these 9 million low-skilled services and BPO roles, 30 per cent or around 3 million will be lost by 2022, principally driven by the impact of robot process automation or RPA.

According to a Bank of America report, roughly 0.7 million roles are expected to be replaced by RPA alone and the rest due to other technological upgrades and upskilling by the domestic IT players.

The RPA will have the worst impact in the US with a loss of almost 1 million jobs, the report said.

“TCS, Infosys, Wipro, HCL, Tech Mahindra and Cognizant and others appear to be planning for a 3 million reduction in low-skilled roles by 2022 because of RPA up-skilling,” the report said.

“This is a USD 100-billion in reduced salary and other costs, but on the flipside, it offers a likely a USD 10 billion boon for IT companies that successfully implement RPA, and another a USD5 billion opportunity from a vibrant new software niche by 2022. Given that robots can function for 24 hrs a day, this represents a significant saving of up to 10:1 versus the human labor,” the report added.

The report warns that emerging economies mostly India and China face the most risk of technology driven disruptions which can impact up 85 per cent of jobs in countries like Kenya and Bangladesh. India and China are at greatest risk of skills disruption, while Asean, the Persian Gulf and Japan are at the least risk, according to the report.

RPA is the use of software rather than physical robots to execute routine, high-volume activities, allowing employees to focus on more distinctive jobs.

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