Nearly 32 pc entities expect AI to drive re-skilling over job cuts: Survey

NEW DELHI: Around 32 per cent of surveyed entities expect AI will drive significant re-skilling and job transformation rather than large net reductions, according to findings from the International Financial Services Centres Authority (IFSC) AI Survey 2026 report.

The data showed that institutions maintain a measured view on workforce changes, while an additional 10 per cent expect technology adoption to create net new roles through new product lines across fund managers, banking units, insurers, capital-market intermediaries, finance, leasing, and fintech firms.

“Entities take a measured, evidence-based view of AI’s workforce impact. The most widely held (32%) expectation is that AI will drive significant re-skilling and job transformation rather than large net reductions. A further 10% expect AI to generate net new roles through new product lines and capabilities,” the report states.

Operational efficiency acts as the primary driver for technology integration, expanding its lead from 64 per cent in 2025 to 82 per cent in 2026. Process automation and productivity improvements across internal operations, risk, and compliance lead organizational motives.

Secondary drivers include cost reduction at 35 per cent, customer experience at 33 per cent, regulatory compliance at 28 per cent, and competitive advantage at 26 per cent. Furthermore, employee engagement increased, with 57 per cent of entities reporting that staff members use AI tools as firms establish internal usage policies.

“Operational efficiency is the standout driver and widened its lead since 2025 (64% to 82%). Cost reduction, customer experience, and regulatory compliance form a strong second tier. The main barriers are data quality and regulatory clarity, a lack of executive buy-in is the least-cited, implying that leadership intent is not the obstacle,” the report noted.

On financial allocation, a combined 60 per cent of entities actively plan, scale, or maintain investments in AI capabilities, leaving 40 per cent assessing their business models. Specifically, 20 per cent have invested, 11 per cent are scaling, and 29 per cent are planning future commitments, with 1 per cent to 5 per cent of IT budgets representing the most frequent allocation.

Deployment spans three tech classes, where Generative AI sees 65 per cent exploration or implementation and Agentic AI functions as the next frontier for early movers.

“Investment in AI across the IFSC is on a clear growth trajectory. A combined 60% of entities have already invested, are scaling, or are actively planning AI investment, with the remaining 40% continuing to assess the optimal approach for their business model and scale,” the survey finds.

Regulatory direction remains a central requirement, with 48 per cent of entities seeking clarity on existing rules and 46 per cent requesting principles-based guidance. Key obstacles include regulatory uncertainty and data quality at 41 per cent each, followed by a lack of responsible-AI tools at 34 per cent and talent shortages at 27 per cent.

Data privacy remains the main risk concern, leading institutions to establish governance frameworks that utilize human-in-the-loop oversight as the primary production safeguard. (ANI)