Zoho's Vembu warns IT job creation stalled by AI costs

Zoho Corp. founder Sridhar Vembu said the Indian IT industry is not creating new jobs because funds are shifting to cover artificial intelligence and data center costs. In a post on X on Sunday, Vembu said the money that would have gone to new employees "is now going to AI and data centre costs, the latter due to the steep rise in server and memory prices."

Vembu, who serves as Zoho's chief scientist, said the company has avoided large-scale layoffs but has not generated significant new employment in recent years. "The real issue facing our nation is how to create jobs for our massive cohort of youth in this very uncertain global landscape," he wrote. "Sadly, the IT industry, including Zoho, have not created many jobs in recent years."

He questioned whether the global software market needs more output, even as AI allows faster production. "While AI allows us to produce more software quicker, does the over-saturated global software market need a lot more software?" Vembu asked. He likened the shift to a commodity market, where focus moves to quality and brand, leading to "much slower" growth.