Technological Transformation and Employee Skill Adaptability in the Service Sector: Evidence from Virudhunagar District

Indian service sector is popular for its competency and efficiency. In seven decades of independence, Indian service sectors have witnessed phenomenal growth. In Financial Year 2020, the contribution of service sectors in Indian GDP is 55.39%. India’s service sectors are not only giving an unprecedented contribution to the growth of the Indian economy but also attracting foreign investors to endeavour their industrialization venture. The Indian service sector has been the growth driver for the Indian economy for the past 20 years. In 2014-15, 72.4% of the growth came from this sector. At a sub-national level to the service sector is the dominant sector. New technologies tend to favour some particular skills while devaluing and making others redundant, but also lowering the demand for them by firms that use such new technologies. The literature describes this trend as 'skill-biased technological change'. Moreover, some authors have found that new technologies increasingly substitute routine tasks, and have labeled this phenomenon as 'routine-biased technological change'. There is a high share of routine tasks not only in manual occupations, but also in white-collar and administrative ones. Both domestic and global factors influence the growth of the services sector. An extensive range of service industries have experienced double digit growth in recent years, supported by digital technologies and institutional frameworks made possible by the government. Technology adoption in business refers to the acceptance and integration of new technologies into existing systems or creating a new one. It is about using technology to its full potential in the process of adapting to changing needs of consumers. Different organizations like start-ups and established organizations react to innovation differently. They can be very enthusiastic about embracing new technology or they might not find it significant enough. The technology adoption lifecycle describes the adoption or acceptance of a new product or innovation in a classic bell curve.