AI Summit 2026: Vinod Khosla warns of job market shake-up, says IT and BPO roles will vanish in 5 years

Tech billionaire and venture capitalist Vinod Khosla has warned that IT services and BPOs will “almost completely disappear” within five years as artificial intelligence (AI) tools will take over tasks currently handled by human workers.

In an interview with Hindustan Times ahead of the India AI Summit, Khosla noted that AI would wipe out most expertise-based professions within the next 15 years, though it could democratise access to healthcare and education.

BPO or business process outsourcing refers to a large segment of work that companies outsource to third-party service providers, which, according to Khosla, will face major disruption. He added that IT services are expected to be similarly affected, with significant implications for India.

How will these jobs be impacted? Khosla weighs in

Khosla, who is the co-founder of Sun Microsystems and founder of Khosla Ventures, said during the interview that AI systems are rapidly nearing a point where they can outperform humans in most economically valuable tasks.

He said that as AI shifts from digital assistants to autonomous “AI workers”, expertise-driven fields such as accounting, law, medicine and chip design could be deeply disrupted in the next decade or two.

His remarks on AI’s capability of outperforming humans come shortly after Airbnb CEO Brian Chesky made similar comments during the company’s quarterly earnings call, where he revealed that its customised AI agent now handles about a third of customer support requests in North America, with plans to expand this service to other countries soon. He also said AI will not just reduce costs, but also improve quality of services.

Meanwhile, Khosla also described the current AI wave as fundamentally different from earlier technology shifts such as the internet or smartphones. Unlike past platforms that enabled new business models, AI replicates cognitive labour itself, he noted, calling it a transformation that could unlock dramatic productivity gains over the next five years.

White-collar employment bears the brunt

Since the country’s IT and BPO sectors, which have created millions of white-collar jobs over the years, are especially at risk, Khosla urged a pivot away from traditional outsourcing toward building AI-native products and services. He added that young Indians should learn to create and use AI tools, rather than relying on traditional outsourcing jobs.

He mirrored the thoughts of Microsoft AI’s CEO, Mustafa Suleyman, who warned that artificial intelligence could replace a large share of white-collar jobs within the next 12-18 months. Suleyman warned that AI will not just impact coders and software engineers; professionals such as lawyers and accountants are also at risk.

Speaking of large-scale job displacement due to AI, Khosla said that such a situation could widen inequality and fuel political backlash if higher productivity gains are not shared widely. He said countries that invest early in building sovereign AI capabilities, including foundational models tailored to national needs, will be better positioned in a landscape likely to be dominated by the US and China.

AI offers some good news too

But according to Khosla, AI is not all bad news. He said the technology has the potential to drastically reduce the cost of essential services, making high-quality healthcare, tutoring, legal support, and other knowledge services widely accessible at very low cost.

He added that robotics, which is a few years behind cognitive AI, could further automate physical work across industries. However, the overall economic impact will ultimately depend on policy choices, Khosla was quoted as saying by HT.

Referring to AI as a once-in-a-generation shift, Khosla said the technology will expedite global competition and impact labour markets faster than most governments and businesses expect.