The impacts of AI are already being felt on the Indian job market.
Zomato has laid off over 500 customer service executives, Moneycontrol reports. There had been several posts on Reddit by Zomato employees over the last week complaining that hundreds of them had been laid off. It now turns out that the layoffs have indeed happened, and affected over 500 Zomato employees in the Gurgaon and Hyderabad offices.
Zomato had hired 1,500 employees under its Zomato Associate Accelerator Program (ZAPP) a year ago for catering to customer support roles. The program offered employees a chance to be elevated to roles across sales, operations, program management and supply chain. But once the year-long period ended, most of these employees didn’t see their contracts be renewed.
Zomato then let these people go, allegedly because of poor performance and lack of punctuality. “Over 300 employees have been fired under similar circumstances, with Zomato showing zero willingness to listen or give even a single chance for improvement,” an employee wrote on Reddit. “They are being inhumane in this scenario, no warnings no nothing, boom Slack deactivated, account taken down within minutes and you’re out of the org before you can speak for yourself,” wrote another. Laid off employees are getting a month’s salary as compensation and don’t have to serve a notice period.
The layoffs come at a time when Zomato has launched its own customer service tool named Nugget. Nugget is an AI powered customer support platform that’s currently powering over 15 million support interactions per month for Zomato, Blinkit and Hyperpure. Zomato has also made Nugget available for other businesses as a SaaS product. It says Nugget provides AI agents that handle customer queries and streamline support.
Zomato isn’t the only company that appears to be relying on AI-based support agents instead of human workers. Last year, fintech startup Klarna had said that its AI agent was not only doing the work of 700 human employees, but was doing it better than humans. The company had said this year that it had stopped hiring humans for its roles. Customer support roles often need language skills and a set pattern of responses for different situations — LLMs in their current form can likely do the majority of these roles, and leave only escalations for human workers. As such, Zomato’s layoffs might only be the beginning of a series of job cuts in customer support roles that could ripple across the service sector.