India’s economic story is increasingly being framed through the lens of scale—of digital infrastructure, capital flows, and now, artificial intelligence. Yet beneath the momentum lies a more fundamental question: can growth translate into jobs at a pace and quality that sustains consumption and reduces inequality? 

Recent labour market evidence, including the India Employment Report 2024 by the International Labour Organization (ILO) and the Institute for Human Development (IHD), suggests that while headline indicators have improved, structural issues around employment quality and access persist, particularly among the youth. 

For Ajay Banga, president of the World Bank, the answer begins with a simple premise. Speaking to Nikhil Kamath, co-founder of Zerodha, on his podcast People by WTF, Banga underscored that “The best way to get rid of poverty is to give somebody a job. Because then you get not only the earnings, but you get them hope and optimism.”  

Why does growth without jobs risk widening inequality? 

The urgency is underscored by a structural imbalance in the global, and increasingly Indian, economy. Asset prices have surged over the past decade while wage growth has lagged. “As long as wage-price growth doesn't keep up with asset-price inflation, inequality is bound to continue to go up,” Banga said. 

This divergence has direct implications for India’s consumption story. While discretionary spending is rising, demand remains uneven. “At a higher income level, consumption is also about how you feel in your head,” Banga said, highlighting how sentiment and wealth effects drive spending. 

If job creation fails to keep pace with economic expansion, growth risks becoming concentrated, weakening broad-based consumption and long-term resilience. 

Why is the skilling gap emerging as a critical fault line? 

If employment is the engine of inclusive growth, skilling is its transmission system. Yet this is where India faces a major constraint. 

Even as the country builds a large talent pool, employability remains uneven. The gap is widening in the age of AI. According to the Future of Work 2025 report by Nasscom and Indeed, between 20% and 40% of work in technology organisations is already handled by AI, with roles evolving faster than hiring frameworks. 

“The real opportunity now lies in preparing people to work effectively alongside AI,” said Ketaki Karnik of Nasscom. 

This is reshaping hiring itself. Nearly all HR leaders expect a “human-plus-AI” workplace while skills-based hiring is replacing credential-based evaluation. Yet employment data shows educated youth face higher unemployment, pointing to a persistent mismatch between education and jobs, as highlighted in the India Employment Report 2024. 

As Nikhil Kamath observed, “There is a lot of uncertainty about AI but the person who becomes comfortable using AI to think will be fine.” Adaptability, rather than static expertise, will define employability. 

How does the AI opportunity compare with workforce readiness? 

India’s AI opportunity is significant. A KPMG in India report, Artificial Intelligence (AI) for Bharat: Innovation and Inclusion at Scale, estimates AI could unlock $1.7 trillion in economic value by 2035. 

India’s digital public infrastructure, expanding talent base, and access to compute resources—including over 38,000 GPUs—have created strong foundations. The country now accounts for roughly 16% of global AI talent. 

“AI is no longer a future ambition, but a present-day accelerator of national progress,” said Akhilesh Tuteja of KPMG in India. 

Yet workforce readiness remains a constraint. As automation expands, the challenge is less about job loss and more about job redesign. Roles are evolving faster than formal job definitions, creating friction in hiring. 

Nearly 40% of employers cite workforce readiness as a key barrier. Skilling systems are struggling to keep pace, even as technological change continues to reshape demand, a trend also noted in the India Employment Report 2024. 

How is the employment landscape shifting in India? 

India’s employment model itself is evolving. The gig economy is moving from a startup-led experiment to a capability-driven system, with large enterprises increasingly hiring for specialised roles. 

White-collar gig jobs are projected to cross 10 million by FY27. At the same time, Tier II cities are emerging as key talent hubs, expanding access to opportunities. 

Job creation is unlikely to follow traditional patterns. Instead, a mix of formal, gig, and hybrid roles will dominate—each requiring higher levels of skill. 

At a sectoral level, services continue to anchor employment growth but face structural challenges such as informality and uneven productivity, as highlighted in NITI Aayog’s India’s Services Sector: Insights from Employment Trends and State-Level Dynamics (2025). 

Why is development a multi-decade effort? 

Economic transformation cannot be compressed into short cycles. It requires sustained investment across infrastructure, human capital, and institutions. 

“My job is not to compete with the private market you have to start thinking about the impact you want to have on the ground,” Banga said, highlighting catalytic capital. 

India’s progress—from digital infrastructure to startups—has built a strong base. But the next phase depends on whether this translates into widespread employment and closes the skilling gap. 

What is the road to inclusive growth? 

India’s ambition of becoming a developed economy by 2047 will be judged not just by GDP, but by the inclusivity of its growth. The country has capital, technology, and entrepreneurial energy. What remains unresolved is aligning jobs, skills, and opportunity. 

“The world does have enough. The distribution of what the world already has is not equal,” Banga said. Bridging this gap will require coordinated action across government, industry, and education—to ensure growth is not just created but shared.