India is experiencing a significant transformation in its labor market due to artificial intelligence, with a new report indicating a substantial net gain in AI-related employment. For every job displaced or lost to AI, approximately 2.6 new AI-centric roles are being created. This positions India as the leading contributor to both AI-driven hiring and job displacements across the Asia region.
According to a Nomura report, accessed by Bloomberg News, India recorded 83,100 AI-related hires against 31,921 layoffs and attrition directly linked to the technology between 2022 and August 2026. Nomura economists Sonal Varma and Si Ying Toh describe India as the “ground zero” for understanding AI’s impact on employment, largely due to its vast workforce and heavy reliance on technology services and business-process outsourcing (BPO).
The Rising Threat to Entry-Level Roles
While the overall job numbers appear positive, the report highlights a critical disconnect: the new positions demand highly specialized degrees, advanced technical skill sets, and years of experience. This creates a significant challenge for workers displaced from routine tasks, such as customer support representatives, who cannot easily transition into AI engineering roles.
This shift is particularly disruptive for fresh Indian graduates. Traditionally, basic entry-level positions served as crucial training grounds, allowing new hires to learn company operations before advancing. However, as automated tools increasingly take over these routine tasks, businesses are moving away from mass hiring and extensive post-onboarding training. Instead, they prioritize candidates who already possess specialized AI expertise.
A Two-Tier Labor Market Emerges
Nomura warns that this trend is fostering a two-tier labor market. Demand for experienced professionals with advanced AI skills is skyrocketing, while opportunities for entry-level workers are shrinking. This dynamic reflects a broader regional pattern across Asia, where 130,758 AI-related hires were tracked against 60,654 job losses.
Over 90% of these new hires occurred within the technology sector, while financial services absorbed roughly 60% of the job cuts. Countries like India, China, and the Philippines, with their large BPO hubs, show the highest exposure to these changes. The data, while representing reported corporate cases rather than a comprehensive census, clearly indicates that AI is rapidly altering the skills required to stay employed, risking leaving many entry-level workers behind.