Forget the AI layoff panic. India has a deeper employment problem

Ah, India's great AI employment debate: everyone panicking about robots stealing jobs, and here comes Manish Sabharwal with a piping hot take that the real problem is 'managing productivity gains and equitable distribution.' Because after decades of underemployment, informal work, and a youth population bigger than most continents, what India really needs is a nuanced lecture about productivity distribution from a think-tank economist. Absolutely nobody saw that coming.

The article, published in the Financial Express, suggests that the AI layoff panic is overblown—which is a bit like telling someone their house is on fire but a bigger fire is in the basement. Sabharwal's point that AI will create productivity gains is technically true, but 'managing' those gains implies a level of institutional competence that India's Ministry of Labour has never exactly been known for. The country's employment problem isn't just 'deeper'—it's so deep you'd need a drill rig to find the bottom. And the equity distribution part? That's the kind of phrase that gets rolled out at conferences while the gig economy expands and the formal sector shrinks.

So, by all means, ignore the AI layoff panic. Focus instead on the deeper employment problem that's been festering since before ChatGPT was a twinkle in Sam Altman's eye. Sabharwal is right that productivity gains could be wonderful. But equitable distribution? That's the kind of phrase that gets rolled out at conferences while the gig economy expands and the formal sector shrinks. India's real AI challenge isn't managing productivity—it's managing the fact that nobody trusts the managers.