Economics, not job loss, is real challenge of AI and automation: Sridhar Vembu

As artificial intelligence and automation technologies advance, public conversations often focus on job loss, particularly in high-skill fields such as software development. But the real issue isn't whether machines will replace workers, but rather how the economy will adapt when they do, according to Zoho cofounder Sridhar Vembu.

Hypothetically, if software development were to become fully automated—a point Vembu emphasises we are nowhere near reaching—millions of software engineers could find themselves out of work. However, that would not mean society would run out of meaningful tasks for humans. The bigger concern is how people would afford the goods and services produced by machines that no longer need human labour, he said.


At the heart of this challenge is a question of economic distribution, not technology, he stated. In a future where robots and AI handle most productive labour, two possible solutions emerge. First, if the cost of goods produced by automation approaches zero, then access becomes universal. In this scenario, people wouldn’t need high incomes to afford the essentials of life, because those essentials would be nearly free, the Zoho chief scientist said.

Second, the human work that remains—such as caregiving, education, ecological restoration, and musicians—may become more highly paid, he said. That "circulates income widely enough for people to afford the goods pouring out of highly automated factories."

This scenario underscores the role of political economy rather than just technological progress. For such a future to be equitable, strong regulation would be needed—particularly crackdowns on monopolies, especially in tech—to ensure that the falling costs of production are reflected in consumer prices, rather than captured as excess profit by a few large firms, Vembu said.

At least one nation will eventually get the political economy right, he added.