India's Software Outsourcing Jobs Drop Nearly Half as AI Cuts Entry-Level Roles

Generative AI is dramatically reshaping India’s software outsourcing sector. New data show that openings for entry‑level programmers have fallen 44% year‑on‑year, pushing overall active IT vacancies to a historic low. The decline reflects a broader collapse of the low‑cost labor model that has long powered the industry.

Major outsourcing firms such as Infosys are launching AI‑skill training for staff, but clients are increasingly adopting AI tools internally, bypassing external contracts. The shift is compounded by a severe shortage of GPU hardware – India holds only about 38,000 GPUs, a fraction of the capacity of a single U.S. tech giant – limiting the country’s ability to develop its own large AI models.

The combined impact threatens millions of junior developers and signals a fundamental restructuring of India’s IT export business.