The Race Between AI and Human Skills Has Begun in India: Goldman Sachs

Generative AI (GenAI) could reshape India’s job market over the next decade, with up to 12% of non-farm jobs facing the risk of replacement, according to a Goldman Sachs report.

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However, the report says AI is more likely to change the nature of work than eliminate jobs entirely, as a much larger share of roles will be supported by the technology.

Key Findings

• GenAI could replace 8-12% of India’s non-farm jobs over the next decade.
• Around 42-48% of non-farm jobs are expected to be complemented by AI, helping employees improve productivity.
• AI could perform 9-17% of the tasks currently carried out by India’s non-farm workforce.
• The biggest impact is expected to be the reallocation of workers across different occupations rather than widespread job losses.
• Jobs involving physical work are likely to see limited impact from GenAI.

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Sectors That May See the Biggest Impact

The report says the impact of AI will vary across industries depending on the type of work involved.

Higher AI support is expected in:

• Healthcare
• Education
• Media and entertainment

Higher substitution risk is expected in:

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• Postal services
• Telecom services
• Parts of the financial services sector
• Customer support and documentation-related roles

The report also notes that routine IT-enabled business process services could face pressure as AI adoption increases. However, India’s technology sector, services exports and Global Capability Centres (GCCs) continue to remain resilient.

Productivity Gains and Infrastructure Challenges

Goldman Sachs estimates that wider adoption of GenAI could increase India’s annual labour productivity growth by around 0.4 percentage points over the next 10 years. Depending on how AI capabilities evolve, the productivity gain could range between 0.1 and 0.8 percentage points annually.

The report also highlights that India’s AI growth will depend on stronger digital infrastructure. Lower computing costs, expansion of data centres, reliable electricity, water availability and better connectivity will be essential to support large-scale AI deployment.

It notes that India’s current data-centre capacity is about 1 GW, accounting for nearly 1% of global capacity, indicating significant room for future investment.

What It Means for Employers

The report suggests that organisations should prepare for workforce transformation rather than focus only on job losses.

Employers should focus on:

• Upskilling and reskilling employees
• Redeploying workers into new roles
• Building AI capabilities across teams
• Investing in digital infrastructure and AI adoption

The report concludes that GenAI will change how work is performed across industries, making workforce readiness and continuous learning critical for businesses in the coming years.

This format is ideal for HR and business readers, with clear headings, concise paragraphs, and bullet points that improve readability.

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