Forced to Retire at 45? Mid-Career Managers Now More Dispensable Thanks to AI

'It becomes too expensive for companies to keep managers because of their high pay grade and low adaptability.'

In this story, we address the following questions:

Why are managers at risk of losing their jobs at 45? Can AI truly replace managers? If 45 is indeed the new 60, should you be planning your retirement more prudently?

(Image: The Quint/@Vibhushita Singh Made Using Midjourney)

An unsettling trend has been brought to attention by those working in India’s Information Technology (IT) sector, one of the largest employers in the country. 45 is now becoming the new 60 as far as retirement age is concerned. 

That’s right, just when you thought you are at the point in your career trajectory where your job is stable and pay-grade is decent, you may be at the risk of a quiet, early exit. 

“This means our viable employability timeline is shrinking; being cut short by 10 to 15 years. And Artificial Intelligence (AI) has a significant role to play in this,” Shiva, a Project Manager at a reputed IT firm, told The Quint. 

In fact, less than 1 percent of the workforce at Tata Consultancy Services (TCS)— India’s largest IT services at consulting company—was above the age of 50 years as per the firm’s annual report for 2023-24. Additionally, those in the 40-50 years age group formed less than 10 percent of the workforce.  

Fingrowth Media Founder Kanan Bahl, who is a chartered accountant and a financial researcher, told The Quint, "This trend is also being seen in the startups, where the proportion of the workforce above 45 years of age is in single digit percentages." 

In this story, we address the following questions: 

• Why are managers at risk of losing their jobs at 45?

• Can AI truly replace managers?

• If 45 is indeed the new 60, should you be planning your retirement more prudently? 

'Too Expensive for Companies to Keep Managers'

Shiva, who has been working in the IT sector for nearly 20 years, said, “There is always a sword hanging over our heads that we might not have a job at 45.”  

He said that although there is no explicit retirement age in the IT industry, if a manager doesn’t show growth or is not promoted, his/her role will become redundant or saturated. “This means the manager will be required to exit from the current firm and either retire or look for a new job, which is extremely tough at 45 years of age,” Shiva asserted.  

But why are managers more at risk than say, freshers or young professionals? 

Shiva attributed it to “a conflict between the employees' perspective and the economics of the role.” 

Professionals in the 40-45 years age group have the right amount of productivity and maturity and have 15 years of experience if not more. But their cost to company (CTC) is at least Rs 18-20 lakhs per annum.  

“Simply put, it becomes too expensive for the companies to keep them,” Bahl said. Besides, he pointed out that the ability of professionals in the 40–50-year age group to adapt to changing technology decreases over time.

Less than 10% Workforce in 40-50 Years Age Group at TCS, Tech Mahindra

As per TCS’ annual report for 2023-24, 1.1 percent of the male workforce in India is over 50 years old, while 10.2 percent of the male workforce is in the 40-50 age group. The proportion of women in these brackets is even lower.

By contrast, the USA, UK and Europe have more employees in the 40-50 and above 50 age groups, although gender disparity remains. 

Screenshot: Annual Report 2023-24

Screenshot: Annual Report 2024-25

Similar trends were observed for Tech Mahindra, one of India’s leading multinational IT services and consulting companies. As per the firm’s annual report for 2024-25, only 9 percent of the workforce is in middle management.

At Infosys, which is India’s second-largest IT firm, around 2.5percent of the company’s employees are above the age of 50, while 59.6 percent are below 30 years of age, as per a 2023 report in Financial Express.

'Courtesy AI: Either Upskill or Become Obsolete'

“Things have changed dramatically in the tech space with the advent of Artificial Intelligence,” Shiva remarked. He added, “Even though the AI technology is at a nascent stage from a management point of view, it is increasingly being trained to do human work.” 

Bahl mentioned that AI is also changing the landscape of startups, which are not only going to be more valuable in future but also bring home more employment.

“Innovation is driving employment in this space, and smooth sailing into 60’s is not a reality anymore. The choice is clear—either upskill or become obsolete,” Bahl posited. 

Shiva recalled the time when we he had joined the industry back in 2005-06 to draw a comparison. “At that time, our manager was not required to be technical. But now, the competition is so cutthroat; clients expect managers to have technical knowhow,” he said.  

Shiva and other managers at his firm have recently undertaken a PG Diploma course in Generative AI.  

'Live Frugally, Save Aggressively, Invest Wisely'

Considering the possibility of retiring 10-15 years earlier than planned, one must start filling their retirement coffers sooner than later.  

Bahl told The Quint:

“Take the example of our parents when they were in their mid-career. They built a house, took care of their children and elderly parents. But today, even when professionals are earning more in real terms, they are living paycheck to paycheck. Courtesy, FOMO culture—taking loans to go to concerts or making expensive purchases.”

While underlining the need to save more using the Employees’ Pension Scheme (EPS) or National Pension Scheme (NPS), Bahl quoted a report by DSP Pension Fund on retirement-savings gap. 

Let’s say an individual would need Rs 5 crore for his retirement but he could save only Rs 2 crore. Here, the retirement-savings gap would be Rs 3 crore.  

The financial services firm projected that the retirement-savings gap in India will rise to $96 trillion by 2050. “I predict that retirement is going to be a very big problem in India if young professionals keep falling prey to consumerism. My advice is: while do enjoy your life but live frugally, save aggressively and invest wisely!"