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The Future of Jobs Report 2025 manifests the transformational effects of the emerging artificial intelligence (AI) and machine learning technologies towards reshaping economies and societies

over the coming decade.

The Future of Jobs Report 2025 manifests the transformational effects of the emerging artificial intelligence (AI) and machine learning technologies towards reshaping economies and societies

over the coming decade. Risks of job displacement, societal polarisation and economic downturn, particularly, for emerging and developing economies, are looming large. An estimate from the

International Labour Organisation (ILO) points out that globally nearly 75 million jobs are at risk of automation on account of AI.

Another report, from Goldman Sachs, says nearly 300 million full-time jobs will remain exposed to AI-driven automation. It is anticipated that by 2030, AI and other information processing

technologies will transform 86 per cent of businesses, sparking the creation of 170 million new roles worldwide while making 92 million existing jobs redundant. The overwhelming anxiety

among workers over displacement from the present job due to widespread adoption of AI can hardly be ignored. The AI-based fourth industrial revolution projects highly specialised

efficiency-driven cognitive-intensive roles of machines to simulate human learning and intelligence. Advancements in technologies, particularly AI and information processing, and automation

are expected to have a divergent effect on jobs, fuelling demand for technology related skills. It is expected that workers’ existing skill sets will either be transformed or become

out-dated over the 2025- 2030 period.

The superior efficiency of AI-enabled robots in performing tasks can lead to job displacement, as they can complete tasks rapidly, precisely and cost-effectively. In the coming days,

analytical thinking will remain the top core skill. This will be followed by resilience, flexibility, creative thinking, technological literacy and motivation along with leadership and

social influence. The combination of cognitive and interpersonal skills emphasises the importance of having an inn ovative and collaborative work force, where both problem solving abilities

and personal resilience are critical for success. Most likely, tasks previously performed by low-skilled workers are now going to face automation, leading to shifts in employment dynamics.

AI generated skill-biased technological change is going to adversely impact the demand for routine, repetitive tasks commonly concentrated among low-and middle-earning unskilled workers

having limited judgement and low cognitive skills.

The displacement of workers is particularly harmful to less-educated and vulnerable groups who will face more difficulties in finding alternative jobs and are more likely to be expos – ed to

low-stability, low-wage, and high-turnover occupations. Recent developments in AI have further stoked fears about large scale job loss, stemming from its ability to automate a rapidly

expanding set of tasks including non-routine cognitive tasks, and its potential to affect every sector of the economy. Firms use automation to maximise profitability by reducing production

costs. The maximisation of profit approach shall risk a disruptive job market in em – erging and low income countries.

The Indian labour market exhibits characteristics akin to a lower-middle-in come country. India’s working age population is nearly 672.8 million. The demography of the Indian labour market

consists of informal, self-employed, contractual, and casual labour. Added to this list is also the formal sector, where temporary, casual, and so-called ‘contract workers’ form a large and

expanding part of the workforce, apart from a minuscule share of regular workers. Around 90 per cent of total workers in the economy are informally employed and nearly 82 per cent of the

workforce is engaged in the informal sector. Self-employment continues to constitute about 58 per cent of total employment in the economy.

As per the India Employment Report 2024, due to the adoption of modern technology, the employment generation in the Indian production process has increasingly become more capital-intensive

and labour saving. Resultantly, growth in employment opportunities in the manufacturing sector remains stagnated at around 12 per cent of total employment. The unemployment rate for

individuals aged 15 years and above has been at 7.9 per cent and the underemployment stands at 7.5 per cent. In India, around 95 per cent of the total youth population, particularly young wo

men, are not associated with education, employment or training. Moreover, 89.4 per cent of adults and 88.9 per cent of youths are in low-skill or no skill jobs.

Almost all of the youth workers in agriculture ~ around 99.9 per cent – and in construction ~ nearly 97.9 per cent ~ are either having no skills or low skills required for jobs in the

manufacturing sector. As in other parts of the globe, the challenges of new technological developments pave the way to the paradigm shift in the skills composition of work in India also.

Jobs requiring high skills shall get prioritised over the low skills ones. Hence, wage inequalities and job polarisation shall become inevitable. Chances are there that the Indian labour

market shall experience a gap between technological advancements and growth in wages which can better be referred to as “Engel’s pause”. Given this backdrop, what will be the roadmap to

bridge the gap between demand and supply of skilled labour? As India is striving for Viksit Bharat (Developed India) by its 100th anniversary of independence in 2047, such a huge unskilled

workforce needs to be adapted with emerging AI technologies. Technological advances are expected to drive skills change and disruption.

There is no denying that emerging technologies need to be adopted to enhance labour productivity. But given the abundant ace of surplus labour in the country, a mechanism needs to be

developed to upgrade the un skilled workers into skilled ones. To navigate the challenges of significant skill disruptions among workers, it is necessary to increasingly finance reskilling

and up-skilling initiatives to align workforce skills with evolving demands. Up-skilling and reskilling the workforce emerges as the most common strategy. For example, the World Economic

Forum’s “Reskilling Revolution” addresses the growing need to transform education, skills, and jobs to meet the demands of a rapidly changing world.

By uniting businesses, governments, and civil society, “Re skilling Revolution” seeks to build a fairer, more inclusive global economy, ensuring individuals and organisations are equipped to

thrive in the future of work. If India is to consider the effects of AI, actions need to be focused on strong institution building even if it is time-consuming and requires intellectuals,

financial resources and supporting infrastructure. As India’s workforce in lowskill and low-value-added services remains vulnerable to AI, robust enabling institutions are essential for

up-skilling and reskilling of labour to equip the workforce with the AI skills and knowledge and to strengthen the long-term skills ecosystem. Skills development and enhancement are

essential to address skill shortages and skills mismatches among aspiring workers.

Moreover, active labour market policies such as vocational training, public works programmes, employment subsidies and apprenticeship training need to be imparted to the unskilled workforce

in overcoming the skills supply and demand gaps. When it comes to funding of reskilling and up-skilling initiatives, the most common funding mechanism is free-of cost training, followed by

government and public-private funding. Simultaneously, it must be a priority to improve public education systems in tune with AI and other emerging technologies. Initiatives shall also be

taken to arrange alternative employment for displaced workers. Investment in green economies, care economies and digital economies thus can create sustainable pathways of employment

opportunity for youths.

The ILO asserts that with growing concerns around green technology and a sustainable environment, dedicated policies aimed at improving efficiency of workers with the contemporary

technologies shall help to generate an additional 8.4 million jobs in the green sector for youth by 2030. Indeed, in the Indian context, adoption of AI is in its in fancy. This level playing

field provides India the time to build the necessary institutions and infrastructure that will minimise disruptions and maximise societal benefits. At the same time, earmarking budgetary

allocations is also necessary to improve the skills of unemployed people and for those workers whose jobs could be at risk from AI. The future of work will be more influenced by

technological innovations. Hence, building on the framework of the Digital Personal Data Protection Act, 2023, India must adopt the governance and regulation of AI to focus on social safety

and security, inclusivity and human rights of the workers as well as prioritising efficiency driven productivity for economic growth.