Tech and lay-offs

THE decision by Tata Consultancy Services (TCS) to lay off over 12,000 employees, or roughly 2 per cent of the workforce, reflects a sector-wide crisis. Artificial intelligence-led technology disruptions and demand uncertainties are forcing India’s once-celebrated IT services industry to effect structural changes. TCS claims the job cuts are owing to a skill mismatch and the inability to redeploy certain employees in its evolving business model. Its CEO’s assertion that AI-led productivity gains are not behind the move is unlikely to calm the industry or the markets. Cost-optimisation initiatives could see layoffs in other IT services companies as well. With AI fundamentally changing the rules of the game, how to be future-ready is bound to top the agenda of every business enterprise. Given this new reality, one question is of utmost concern — does this technological shift necessarily have to be at the cost of employees?

TCS has invested heavily in AI upskilling and training, and yet has been unable to retain many mid-to-senior level employees. The acknowledgement that reskilling does not always work has rung alarm bells. A scary scenario looms of businesses, large or small, blindly adopting the new models for fear of missing out. In these uncertain times, a silver lining, if any, is India’s successful mass-scale technological transformation over the years — the digital embrace at every socio-economic level. The AI adoption needs the same structured, regulated, public-private sector handholding. In short, an Indian approach that values human resource and its capacity to adapt to change.

India’s burgeoning job crisis demands sustained intervention. The record turnout at the two-day test organised by the Haryana Staff Selection Commission is a reminder of the scale of unemployment and the lack of opportunities. The demographic dividend is fast losing its value.

Editorials