{
  "id": 41266,
  "title": "IT industry not creating new jobs, funds diverted to AI, data centre costs: Sridhar Vembu",
  "url": "https://urgent.news/2026/08/02/it-industry-not-creating-new-jobs-funds-diverted-to-ai-data-centre",
  "topic": "ai",
  "section": "AI",
  "published": "2026-08-02T11:49:56.000Z",
  "source": {
    "name": "Economic Times Tech",
    "slug": "economic-times-tech",
    "url": "https://economictimes.indiatimes.com/tech/artificial-intelligence/it-industry-not-creating-new-jobs-funds-diverted-to-ai-data-centre-costs-sridhar-vembu/articleshow/132806008.cms"
  },
  "original_language": "en",
  "account": "Zoho Corporation founder and chief scientist Sridhar Vembu has raised concerns about the IT industry's lack of new job creation, attributing the issue to funds being diverted towards artificial intelligence (AI) and data centre costs. In a post on social media, Vembu highlighted that while companies like Zoho have avoided layoffs, they have failed to generate significant new employment opportunities in recent years. He pointed out that money that would have gone to new employees is now being allocated to AI and data centre infrastructure, which has seen a sharp increase in server and memory prices.\n\nVembu questioned the necessity of producing more software in the current environment, especially given the potential oversaturation of the global software market. He argued that while AI enables faster software production, the industry's focus is shifting towards quality, reliability, and brand, which will result in slower growth. Furthermore, Vembu noted that enterprise customers are reallocating their IT spending towards AI, raising concerns about the financial viability of AI companies currently engaged in heavy capital expenditure (capex).\n\nOn the broader topic of employment, Vembu expressed uncertainty about whether the manufacturing sector could compensate for the lack of new IT jobs. He noted that extensive automation in manufacturing leads to large-scale production with few job opportunities. Vembu also pointed out that while technology lowers production costs, making goods more affordable, it creates a structural challenge for the economy in terms of income distribution. He suggested that finding a way to ensure people have the income to afford these affordable goods remains a complex issue.\n\nVembu briefly touched on the idea of Universal Basic Income (UBI) as a potential solution, noting that elements of it are already present in India through free government initiatives. He suggested that political pressure to expand such measures is likely to grow as the challenge of employing the nation's youth persists in an uncertain global landscape.",
  "summary": "In a post on social media platform X, Vembu noted that while the IT industry, including Zoho, has avoided large-scale layoffs, it has failed to generate significant new employment opportunities in recent years.",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}