A Study of the Effects of Artificial Intelligence-Driven Automation on Jobs in the Banking Sector

Technology adoption is important to assess the usage of technology and includes parameters other than automation potential. India is seen to be a country at high-risk of bearing the brunt of AI-led automation. It will impact its large workforce which is low-skilled and having low level of education. Decoupling of India’s GDP growth with employment growth has already been seen with an employment elasticity of 0.2 in the period from 2019-2024. This is a worrying trend for a country such as India and its demographic dividend. A study of the future of jobs in the Indian market forecasts that by 2022, 9% of India’s workforce will be employed in jobs which do not exist today and 37% in jobs with a substantial change in the skill set requirements. 43% of India’s current workforce is at risk of potential displacement due to adoption of intelligent technologies. AI also creates an uncertainty in the minds of the existing workforce rife with fear that their jobs will be taken over by machines. Some of the current slowdown in fresh hiring and retrenchments in companies is being attributed to the adoption of automation and AI technologies in tasks and jobs. The ongoing pandemic has further accelerated the adoption of automating technologies in business Research studies to understand the implications of the forthcoming change are needed by multiple stakeholders like policy makers, business leaders, workers and students to proactively address the potential displacement of workforce. Given India’s unique position in the current technology landscape, there is also a potential to turn risk into opportunity and gain competitive advantage by providing a future-ready workforce to the world. This research is a focussed study on the potential impact of AI-led automation on jobs in banking sector in India. It is focussed in geographical, sectoral, functional and technological scope. The study objective is to produce sharp insights for the stakeholders in the banking industry in India and for providing a blueprint for similar research in other industries in future.