The IT slowdown nobody wants to talk about
Issue #15 AI isn’t just changing jobs — it’s changing the game.
So the world is super bullish on India right now. Morgan Stanley calls it the best place in Asia to invest. Everyone’s betting on strong growth — infrastructure, low interest rates, services boom, you name it.
But there’s one crack in the story that barely gets a mention.
The Indian IT sector is slowing down. And it’s not looking like a short-term thing.
Not as ‘local’ as people think
People love to say India’s economy is “domestic driven” because exports are only 20% of GDP. But the IT sector connects directly to the global market.
When US and Europe slow down, Indian IT companies feel the hit.
And it shows up in the one place that matters most: jobs.
The hiring party is over
The last few years, IT hiring went crazy — especially after Covid. Now? Big slowdown.
FY24: only 60,000 jobs added.
FY25 expected: 1,26,000.
But here’s the real thing — most of these jobs aren’t from the big names like Infosys or TCS anymore.
Global Capability Centres (GCCs) are doing the hiring. Indian IT firms are pulling back.
AI is the elephant in the room
AI tools like GitHub Copilot are writing code faster and cleaner than juniors. Companies don’t need armies of freshers anymore.
Same for BPO. Before, $1 billion worth of BPO business gave 50,000 jobs. Now? Barely 12,000. And shrinking.
Even infrastructure and app support jobs — could be 60% automated soon.
Less work for people. More for machines.
The chain reaction
This is not just about IT guys losing jobs.
IT drives demand for offices, apartments, cars, restaurants, malls — especially in cities like Bengaluru, Pune, Hyderabad.
Tech firms were leasing 40-50% of office space. Now it’s down to 25%.
Each IT job used to create 3-4 more jobs in the economy.
IT professionals are huge buyers of premium cars, apartments, gadgets.
If IT hiring stays weak, the whole urban economy slows down with it.
Will new tech create new jobs?
Usually tech kills some jobs but creates new ones. But AI is different. It learns on its own, improves fast, and needs less human help.
Even “prompt engineering” — the new trendy skill — might not last long.
Next-gen AI can write its own prompts. And with quantum computing coming, this could get even worse.
Time for a reality check
The slowdown in IT is more than just numbers — it’s a warning.
People need new skills. Fast.
The economy has to expand beyond IT.
Policies must be flexible and future-ready.
Otherwise, the cracks in the story will only get bigger.
That’s it. No easy answers, but definitely worth thinking about.
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Source: https://tinyurl.com/kayxzfaz
Much love,
Priyank