View: What lies ahead for ITeS sector & how GoI can play its part

ITeS sector has come through a turbulent 2023 due to challenged growth, squeezed profit margins and fewer people on the payroll than in 2022. Many cite these developments as a symptom of the sector's decline and blame AI for the crisis.

Depending upon which source one believes, the headcount in the sector has reduced between 5% and 10%. From a societal perspective, this is terrible news because the industry in the last three decades has:

• Employed more than 4 million young professionals.

• Empowered a whole generation of women with a 51% entry-level diversity ratio.

• Spurred cascading economic activities, such as food and transportation services.

• It has been the beacon of India's emerging economic power. The sector's ability to deliver world-class services to blue-chip companies and governments has played a massive part in building Brand India.

Job cuts is not good news. Except, it is. It is inevitable and represents the new reality. It is happening due to:

Intelligent automation: The industry has adopted a new generation of intelligent automation technologies, either in their data centre management practice or large language model (LLM) domain. The need for people is lesser. For example, making a 100-page website took 4-6 months, from design to completion. Today, it takes a few minutes, using standard automation tools. Self-healing data networks now know when the flow of packets has been interrupted, and the software repairs are initiated autonomously in many cases. Previously, a network engineer would have been required to fix even the basic faults. Automation and AI will have a more significant impact in 2024 and beyond. Fewer people are going to be needed. That's a fact.

Up in the clouds: International Data