## The Irony of India's Labor Market

The fear that **artificial intelligence (AI)** could hollow out technology jobs is arriving at a moment of deep irony in India’s labor market. Entry-level tech professionals, once symbols of upward mobility, are now being out-earned by home service workers on gig platforms such as plumbers and electricians—a reversal that would have seemed unimaginable a decade ago. Against this backdrop, a dramatic global selloff triggered by Anthropic’s latest AI release has sharpened anxieties about whether the tech sector itself is heading toward a reckoning, and whether entry-level white-collar jobs will bear the brunt of it.

## The "SaaSpocalypse" Triggered by Claude Cowork

On Wednesday, the launch of **Claude Cowork** by AI giant Anthropic set off what brokerage firm Jefferies described as a “SaaSpocalypse.” Global software stocks lost an estimated $285 billion in market capitalization as investors reacted to the implications of the new tool. Cowork allows multiple humans and AI agents to collaborate in a shared digital workspace, automating workflows across legal, sales, marketing, and data analysis. Market fears stemmed from the belief that such agentic coworkers could replace human employees, and potentially the software companies that sell tools to them.

## India’s Entry-Level Squeeze

These global anxieties intersect sharply with India’s domestic realities. Entry-level tech salaries in India are already low, and evidence is emerging that technology professionals are being outpaced by skilled manual and service workers.

Home services platform Urban Company (UC) has said its partners earned an average net income of Rs 28,322 per month during the first nine months of FY26, according to its Partner Earnings Index released on Wednesday. In a post on X, Abhiraj Singh Bhal, cofounder and CEO of Urban Company, said the data points to a “quiet but important shift toward dignified, skill-based work.” He added that these earnings are well above statutory minimum wages and on par with or better than entry-level IT salaries.

Urban Company said entry-level IT and ITeS salaries are assumed at Rs 4 lakh per annum, based on publicly available industry data including Glassdoor estimates. The earnings gap widens at the top end of UC’s workforce. The top 20% of service professionals earned an average Rs 42,418 per month, the top 10% earned Rs 47,471, and the top 5% earned Rs 51,673.

In this context, AI-driven disruption threatens not just job security but the economic rationale of pursuing entry-level tech roles at all, particularly if automation suppresses wages further or eliminates junior positions altogether.

## 6 to 12 Months: Amodei’s Stark Timeline

The tech stock selloff amplified attention on statements made by Anthropic founder and CEO Dario Amodei, who has been unusually blunt about AI’s labor implications. Speaking recently at the World Economic Forum, Amodei said, “We’re 6 to 12 months from AI doing everything software engineers do.” His remarks reflect a broader view that AI is no longer just augmenting technical work but rapidly approaching full substitution across many white-collar roles.

Amodei has repeatedly warned that significant job cuts could occur within five years, particularly affecting entry-level roles in technology, finance, law, and consulting. He has urged consumers and US lawmakers to prepare for this shift, while criticizing governments and AI companies for “sugar-coating” what he sees as an unavoidable reality. “Most of them are unaware that this is about to happen. It sounds crazy, people just don’t believe it,” he said.

In a recent article, Amodei sharpened the forecast further. “My prediction for 50% of entry level white collar jobs being disrupted is 1-5 years, even though I suspect we’ll have powerful AI (which would be, technologically speaking, enough to do most or all jobs, not just entry level) in much less than 5 years,” he wrote.

Industry observers echo this concern, warning that as agentic systems mature, they could move beyond junior roles and begin displacing mid-level jobs in consulting, IT services, legal process outsourcing, and corporate services.

## Why AI Job Disruption May Differ from Previous Ones

Amodei argues in his recent article that AI differs fundamentally from previous waves of automation. While mechanized farming and industrial machinery displaced workers in specific sectors, they also created new industries that absorbed labor elsewhere. AI, he suggests, may not follow this pattern.

Amodei identifies three defining features. The first is **speed**: AI progress is unfolding far faster than past technological disruptions, giving workers and labor markets little time to adapt. The second is **cognitive breadth**. Unlike tools that automated narrow tasks, AI systems are increasingly matching humans across a wide spectrum of mental work, from coding and legal analysis to strategic reasoning. The third is **general labor substitution**. If AI can perform many cognitive tasks, it may also take on the new jobs that traditionally emerge after automation, compressing the labor market rather than reshaping it.

These features undermine the traditional promise of retraining. If AI systems can quickly learn new skills at scale, displaced workers may find that the expected new jobs of the future are automated almost as soon as they appear.

## Transformation, Not Extinction?

Despite the alarm, leaders in India’s IT services sector argue that AI will reshape work rather than erase it. Cognizant chief executive Ravi Kumar S struck a more measured tone at the company’s earnings briefing. “Any disruption will ‘take away jobs of the past and create jobs of the future’,” he said. “Old software will get modernized, and technical debt on enterprise landscapes will be rejigged. But tech service companies have yet to capture the ‘drift value’ from AI-infrastructure companies, leaving room for system integrators to grow and evolve towards an ‘AI builder’ strategy.”

Happiest Minds Technologies chairman Ashok Soota echoed this view, as quoted in a recent ET report. He said all platforms and plugins will expand, not diminish, the role of services companies. Innovations such as Cowork lower barriers to building software but increase the need for firms that can guide enterprises through large-scale transformation, integration, governance, and orchestration, said Soota, a Wipro veteran who cofounded Mindtree.

In the counter perspective, tools like Claude Cowork are not job killers but catalysts, shifting demand toward higher-order skills in AI architecture, compliance, and organizational change management.

The tension between these two narratives—mass displacement versus structural evolution—defines the current moment for the global tech workforce. What makes the debate especially urgent in India is the new reality of entry-level employment, where salaries are already under pressure and alternative forms of skilled work—such as plumbers and electricians—are becoming more remunerative.

India's entry-level tech jobs face a stark reality as home service workers reportedly now earn more. A recent AI release has intensified fears of widespread job displacement, with experts predicting significant disruption to white-collar roles within months. While some industry leaders foresee a transformation of work, others warn of unprecedented automation impacting numerous sectors.

AI Job Apocalypse: Plumbers Now Outearn Entry-Level Techies in India

## The Rise of Physical AI: A New Frontier in Job Displacement

**The sudden boom in robotics and artificial intelligence** is fueling widespread fear that soon, **no jobs will be safe from displacement**. While AI has already begun disrupting office roles by analyzing data and drafting documents, the next wave could target **blue-collar jobs**—a sector once considered secure due to AI's inability to perform physical labor.

Recent advancements in robotics suggest it's only a matter of time before **AI-powered machines** can repair pipes, operate bulldozers, and prepare food. This shift introduces a host of new policy challenges for lawmakers and unions to address.

"It's a whole other challenge on top of the large language models," said Dan Reynolds, assistant research director at the Communications Workers of America Union. "Having an automated system interacting with the real physical world is a separate mountain to climb."

## The AI Industry's Rapid Move into Robotics

**The ChatGPT moment for physical AI is here**, declared Nvidia CEO Jensen Huang at CES last month. The AI industry is swiftly integrating technology into robotics, prompting unions representing trade workers to proactively address this "physical AI" trend. Their goal is to mitigate the disruptions already seen in white-collar industries like software development and finance.

However, preparing for labor displacement that hasn't yet occurred presents significant challenges. "Our concern right now is [AI robotics] is just moving too quickly," said David White, director of strategic resources at the International Association of Machinists and Aerospace Workers. "It makes it difficult to plan for how this is actually going to affect workers."

## Union Strategies and Federal Initiatives

Unions are increasingly worried that current shifts in white-collar work could foreshadow impacts on jobs outside the office. "White collar work will probably be the first tranche, but every job across sectors will be impacted," stated AFL-CIO President Liz Shuler. In response, unions are pushing for AI bills in California, including provisions for advanced notices of AI-related job cuts to protect workers across various labor sectors.

On the federal level, Congress and the Trump administration are focusing on leveraging the AI boom to develop the robotics industry. A bipartisan House group recently unveiled a plan for a national robotics strategy, while Commerce Secretary Howard Lutnick has engaged with companies to foster industry growth. However, a nationwide shift to robotics could conflict with the administration's goal of boosting blue-collar manufacturing jobs.

## Proactive Measures and Contract Negotiations

Union representatives are working to preemptively introduce protective language into labor contracts. For instance, the International Association of Machinists and Aerospace Workers is building a database of model AI contract language to advocate for in negotiations. These provisions include requirements for **worker input** during automation integration and **retraining** if technology leads to downsizing.

"If we are brought into the process earlier, we can help plan implementation that enhances people's jobs instead of having deteriorating effects on them," explained White.

## The Realistic Timeline for AI Robotics

A key challenge in these negotiations is the uncertainty surrounding when companies will fully adopt physical AI. "We've been hearing for at least 15 years that we're going to have driverless trucks next year," noted Matt McQuaid, media coordinator for the International Brotherhood of Teamsters. "There's a lot of overpromising and underdelivering in the tech industry."

**How realistic is this fear?** According to research firm Challenger, Gray & Christmas, companies cited AI in layoff announcements for over 50,000 jobs last year, with the government and technology sectors hit hardest. However, there is debate over whether employers are using AI as an excuse to cut workforces. A recent MIT study found that AI has led to a greater reduction in roles involving analysis and information processing, particularly in business, finance, and engineering.

## Technical Hurdles and Future Predictions

Developing AI robotics is more complex than programming a chatbot. Darren Kimura, CEO of AISquared, highlighted that several major breakthroughs are needed before jobs requiring manual labor are threatened. "For robots to be able to do things like wire your house or plumb things or fix a motor, it has to take into account sensors for heat, vibration, sound, smell," he said.

Kimura predicts it could take nearly a decade for researchers to achieve such innovations, giving unions time to develop their plans. In the meantime, he argues that manual work will become more valuable. "The skilled trades work—you can't replace that with a robot, at least certainly not anytime soon," he told DFD. "Frankly, there's going to be more of those types of roles needed."

## Additional Developments in AI Policy

- **White House Office of Science and Technology Policy Director Michael Kratsios** will lead a U.S. delegation to the AI Impact Summit in India later this month. The summit will provide an update on Trump's America AI Exports program, aimed at promoting U.S. tech globally.
- **Several online safety groups** are criticizing OpenAI's chatbot ballot initiative in California, arguing it could exempt AI companies from existing consumer protection laws. Common Sense Media, however, supports the initiative, calling it the "most comprehensive youth AI safety law in the country."

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The sudden boom in robotics and artificial intelligence is driving a fear that soon, no jobs will be safe from displacement.

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