Artificial intelligence is rapidly moving from science fiction to a daily reality in the workplace. But while it promises to boost productivity, there's a growing concern that AI could become a great divider, widening the economic gap for workers.
The Uneven Impact of Automation
The
technological revolution driven by AI doesn't affect everyone equally. Unlike previous waves of automation that primarily impacted manual labour, AI is capable of performing routine cognitive tasks. This puts a different set of jobs at risk—many of which are held by workers without a university degree. A recent paper from IIT Madras highlights that tasks in sectors like business process outsourcing (BPO), bookkeeping, and even entry-level IT are increasingly susceptible to automation. The core issue is that AI excels at predictable, process-oriented work. This could include anything from answering standard customer service queries to processing invoices, tasks that have traditionally served as entry points into the white-collar workforce.
A Widening Chasm in Skills and Wages
The primary concern is not just about job losses, but about a phenomenon known as labour market polarisation. Research from institutions like the International Monetary Fund (IMF) suggests that AI tends to benefit two groups the most: high-skilled workers who can design and manage AI systems, and some low-skilled service workers whose jobs are difficult to automate. Left in the middle are many non-graduate workers whose routine tasks are prime candidates for replacement. This 'hollowing out' of the middle can lead to greater inequality. Even for those who keep their jobs, if AI can perform a significant portion of their duties, the value of their skills may decrease, leading to wage stagnation and reduced bargaining power. Studies have found that while vacancies demanding AI skills offer higher wages, this hasn't necessarily boosted overall employment, suggesting a shift of wealth towards a smaller, highly-skilled group.
The Indian Context: A Unique Challenge
In India, this trend presents a specific set of challenges. A huge portion of the workforce is employed in roles with a high degree of routine tasks, from manufacturing to the massive services sector. An IIT Madras study points to an 'AI-cost geography' in India, where affordable AI tools could rapidly automate jobs in BPOs and back-office processing. This is particularly concerning for entry-level workers. Many junior roles in IT, finance, and other professional services have historically served as apprenticeships, where workers learn the fundamentals through repetitive tasks. As AI takes over this work, those traditional career ladders may crumble, making it harder for young, non-graduate workers to gain experience and advance. Hiring data already shows a slowdown in recruitment for junior positions, even as demand for AI-specific skills rises.
The Reskilling Imperative
The solution isn't to halt technological progress, but to adapt the workforce. There is a consensus among experts that massive investment in reskilling and upskilling is critical. However, this is easier said than done. The World Economic Forum notes that while a majority of companies recognise the need for training, a significant portion of the workforce may not receive the upskilling they need. The challenge is twofold: identifying the right skills for the future and making training accessible and effective for millions. The skills in demand are not just technical. Employers are increasingly looking for humancentric abilities that AI cannot replicate, such as critical thinking, emotional intelligence, and complex problem solving. For non graduate workers, the path forward will likely involve acquiring a blend of specific technical competencies and strengthening these uniquely human skills.
