International companies operating technology centers in India are taking a cautious approach to new hiring as artificial intelligence transforms the workplace and geopolitical concerns mount, according to the head of a major consulting firm.
Lalit Ahuja, who founded and leads ANSR, a company that assists businesses in establishing and managing global operations centers, spoke about the changing landscape on Monday. His firm works with major corporations including FedEx, Target and Lowe’s.
“There is a sense of cautiousness,” Ahuja explained to Reuters. “Companies are hiring fewer people, just as a matter of abundant caution.”
India has become the preferred destination for more than half of the world’s international capability centers, thanks to its extensive pool of skilled workers, reduced operational expenses, and increasing capacity to handle sophisticated roles in technology, finance and engineering sectors.
But the emergence of artificial intelligence technology presents new challenges to India’s competitive advantage by potentially reducing staff requirements for certain positions and changing the nature of work performed at these global facilities.
According to Ahuja, recruitment numbers are dropping by 30% to 50%. Some corporations that originally envisioned establishing centers with workforces exceeding 5,000 people are now reducing their plans to approximately 2,000 employees. He declined to provide additional specifics.
Industry projections indicate India will accommodate nearly 2,200 global centers employing a workforce of 2.36 million people by the conclusion of the fiscal year ending in March, based on research from IT industry organization Nasscom and consulting firm Zinnov released this month.
Looking ahead, Ahuja anticipates that with recruitment expected to remain limited in the short term, newcomers to the market will fuel expansion as businesses develop core staff alongside larger flexible employee pools that can expand or contract according to operational requirements.
This strategy represents growing weariness with a “wait-and-watch” mentality, as corporations opt to employ fewer workers than originally intended, launch operations on a reduced scale, and monitor how situations develop.
“Companies are now undertaking bold experiments,” Ahuja noted.
“You can always hire more, but it’s always difficult to let go of people.”
