Job losses: How AI has painfully disrupted dreams of young software engineering graduates

IT CEOs have indicated that AI-led productivity is changing the business model, with revenue growth and headcount growth being de-linked. 'The last couple of years, we have been challenging our teams on how you can deliver twice the revenue and half of the people,' said HCLTech CEO C Vijayakumar in February.
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( Originally published on May 31, 2025 )
As a story going viral recently recounts, back in the early 1990s, Infosys cofounder Nandan Nilekani had prodded and pestered actor and playwright Girish Karnad, a distant relative, to buy into the then-obscure software firm's IPO.As told to journalist Rollo Romig, author of I Am on the Hit List: Murder and Myth-making in South India, Karnad eventually gave in and bought some shares of Infosys. Within 10 years, as Infosys—and India's burgeoning IT sector—g rew, the share prices skyrocketed and helped Karnad out of a lower-middle class living to greater comforts, like a house of his own.Transformative. There is no other word that encapsulates what C++, Java and Python did for India and millions of folks like Karnad. Beyond shareholders, zeros and ones carried with them the aspirations of millions of youth who gained not just employment, but a living that lifted their families out of the lower middle-class trap, powered by fancy salaries, lucrative stock options and promise of foreign postings.So far so good. Then, out of nowhere, came the threat from artificial intelligence (AI). India's middle-class dreams, written in the promise of software, is now under threat from advancements of that very software.The jobs that millions of students had taken for granted as an entry to a long and successful career aren't quite there anymore, and a thirty-year dream is starting to lose steam.The drastic shift is leaving a bloody trail of laid-off employees, changing job descriptions and under-skilled young engineers.Pradeep (name changed), a techie in Bengaluru, is job hunting. This isn't the best time to be looking for one. But he does not have a choice as his company, a unicorn, fired him five months ago, along with close to a dozen colleagues.The last time he was looking for a job was in 2018 when he was a final-year engineering student. Back then, all that the unicorns he was interviewing for wanted was solid programming knowhow.After six years, he was laid off and there are more things he is worried about than getting the basics right. 'Even if I get a job, how long can I hold on before the company decides otherwise? Is this going to be the end of my career?'Things are worse for junior developers just entering the workforce where AI tools can do a much better job. Their days are now marked by anxiety, fear and insecurity that threatens careers, lest they don't keep up with the change, and at times even when they do.Sneha (name changed), a manual tester in a Bengaluru-based IT services firm a decade ago, remembers how worried they were when automation was introduced. 'We were worried that our jobs would be lost,' she reminisces.That never came to pass in the five years she spent in the firm before moving to consulting. But today, testing is one of the areas seeing the most automation, and others such as frontand back-end development are soon likely to follow.All of this, naturally, is leading to mental health issues.Harpreet Singh Saluja, president of IT professionals' welfare association Nascent IT Employees Senate (NITES), has been seeing increasing anxiety in young professionals with up to five years of experience, who were beginning to feel they were being gradually sidelined or replaced.'Many are unsure whether their job will still exist in the next six months or a year,' Saluja says.'Every single project that you do, they track how many AI tools or AI integrations you are using. They don't always say it, but the bottom line is that if you don't, your job is at risk,' says Pradeep.In long Reddit threads, software developers have been sharing how their department heads emphasise using AI tools and are removing teams that were doing documentation, something that has since been easily automated.For the moment it is each to their own.To stay relevant, many are upskilling and learning AI-first thinking and how to create workflows using AI. Platforms such as Scaler Academy, Newton School and 100xEngineers are seeing huge demand for their online courses on AI and ML.'It is a six-month weekend course, which is a mix of lectures and hands-on exercises,' says Sridev Ramesh, cofounder, 100xEngineers.While new-a g e schools profit, engineering colleges that mushroomed across the country over the last few decades are just not equipped for this transition, and that is resulting in students charting their own course.Take Rachit (last name withheld to protect identity), a second-year computer science student. He was clear that regular engineering colleges might not help. After preparing for IIT-JEE, he decided to pursue a four-year undergraduate degree with Newton School of Technology, which focuses on AI.An avid programmer from Class 8, he taught himself Java and then Python, and is currently interning at one of the top AI startups in India and in his words 'is loving it'.As Nishant Chandra, CEO, Newton School, points out, the ecosystem is changing fast and students need to change with it. Chandra reckons that unfortunately about 90% of the colleges are not forward-looking, and that will impact the students.Prasad (name changed), a third-year engineering student, and his batchmates often discuss what AI would do to their prospects. 'We are still a year from when we have to face it, but at present, we are unsure what we can do,' he says.Prasad, who hails from a tier-3 town in Kerala, is doing computer science in Coimbatore. Ask him if the college is taking additional initiatives to equip them, and he is confused. 'We have not heard anything from the college. Maybe we will see something before we start placements next year,' he says.Unfortunately, by the time reality hits, it might be too late for students like Prasad.Neeti Sharma, CEO, TeamLease Digital, says most engineering graduates are not completely ready for AI jobs.'More than 60% of these students don't have enough hands-on knowledge and experience,' says Sharma, adding that beyond college degrees, what's needed is certifications in AI, cloud, security, or data science, working on real projects (like sharing code on GitHub), and joining hackathons or inter nships. 'Students who keep learning and can show real projects or skills will have the best chance of getting hired in today's job market.'That's not going to be easy.'We can't just learn one or two skills and assume that it will take us through the next five years,' says Savita Hor tikar, global head of talent acquisition at the AI company Fractal, adding that adapting to the new reality of 'continuous learning' is often harder for experienced professionals than freshers.IT CEOs have indicated that AI-led productivity is changing the business model, with revenue growth and headcount growth being de-linked. 'The last couple of years, we have been challenging our teams on how you can deliver twice the revenue and half of the people,' said HCLTech CEO C Vijayakumar in February.This means AI taking over grunt work and humans focusing on strategy, ethics and innovation, says Roop Kaistha, regional managing director-APAC at recruitment firm AMS.That is going to complicate things.India is home to the second largest pool of software developers in the world, with 5.8 million professionals. It also produces around 1.5 million fresh engineers every year. However, just 10% of them have the ability to secure jobs, according to a TeamLease report.So the question of higher-level output is going to be a pipe dream unless both the individual and the system change their orientation.Government, companies and institutions need to work together and create courses that match what businesses actually use now, says TeamLease's Sharma.Nitin Pai, director of Takshashila Institution, a centre for research and education on public policy, says that as long as companies and workers are prepared to learn, adapt and adjust, India will benefit from the AI revolution just as it has benefited from previous turns of the tech cycle.Sharmila Sherikar, head of corporate development, Sonata Software, says self-skilling has also become nonnegotiable with AI-readiness now being a baseline expectation.'Skilling programmes must evolve from being theoretical to being outcome-focused, anchored in the realities of a tech-driven, rapidly changing business landscape,' she says.'While we have a number of skilling programmes underway, I think they are too disaggregated,' Sangeeta Gupta, SVP & chief strategy officer of Nasscom, recently told ET. 'You need a much more top-down thinking on skilling, not just for the top-end of AI, which is all the data scientists and that kind of work, but how will the workingage population be using AI more effectively in the day-to-day operations?'Until that happens, the pain will linger.As A Damodaran, professor, economics, IIM-Bangalore, says, 'We have seen automation disrupting businesses historically. The biggest was textiles and then factories, where automation led to job losses. In factories, before automation, many of the workers were handling hazardous materials, and nobody voluntarily did that. And as history would show, people found other jobs. That will happen again.'Unfortunately for the next generation of millions who were betting on software jobs, history will unfold far too slowly.

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