In India, AI is creating more jobs than it destroys, Nomura finds

India is the world’s back office, and that makes it “ground zero” for measuring what AI does to work. Nomura economists Sonal Varma and Si Ying Toh set out the case in a report covered by Bloomberg. Its sheer scale means it feels the “largest absolute impact” across layoffs, hiring freezes and recruitment. And the recruitment is winning.

In India, the bank counted 83,100 AI-related hires between 2022 and this month, against 31,921 layoffs and attrition, more than two hires for every job lost. Across Asia the gap is wider still: 130,758 AI-related jobs added, over 90% of them in technology, versus 60,654 lost, around 60% of those in financial services, Business Today reported.

The catch beneath the headline

The finding, the economists wrote, “runs counter to the narrative of massive job losses due to growing AI adoption”. At least in the early stages, job creation is more than offsetting displacement. They see the same pattern in China and in the Philippines, where outsourcing anchors the labour market.

But the net number hides a harsh swap. The people let go are mostly support teams replaced by chatbots. The people hired are mostly IT-services graduates that firms credit directly to AI demand. “Since displaced workers rarely transition to AI engineering roles,” the economists warned, “the aggregates do mask distributional pain.”

A two-tier market

That is the real shift. In India and Korea, AI is carving a two-tier labour market, thinning demand for entry-level workers while lifting it for experienced staff who grasp the business. The junior rung, long the on-ramp into India’s IT industry, is the one being pulled away.

It is a more hopeful reading than the white-collar cuts landing elsewhere, and it arrives as money keeps pouring into India’s AI build-out. Optimists such as Nvidia’s Jensen Huang have dismissed the jobs-doom talk for a while. The Nomura data hands them a number to point to.

The caveats are real. The study rests on 69 anecdotes drawn from news reports, not payroll records, in a labour market Nomura calls fragmented. It is a snapshot of a fast-moving early phase, not a verdict. For now, in the one country watching this most closely, AI is adding more jobs than it takes. Whether that holds is the question India cannot yet answer.