US tariff shock: India’s domestic demand may cushion job losses. Here’s how to safeguard your career

The steep US tariff hike on Indian exports has sparked alarm in India’s job market. While some experts foresee an immediate crisis — especially for labour-intensive sectors like textiles and gems and jewellery — others believe domestic demand and emerging trade partnerships could soften the blow.

"The recent imposition of additional US tariffs is expected to have a direct and substantial impact on India's employment landscape," Genius HRTech founder R P Yadav told PTI. "This will especially impact those industries relying heavily on the US market for business continuity and growth."

Yadav estimates that 2-3 lakh jobs are at immediate risk. The textiles sector alone could lose around 1 lakh jobs if tariffs remain in place beyond six months. MSMEs, the backbone of these sectors, will bear the brunt.

"Similarly, in the gem and jewellery sector, including units in Surat and SEEPZ in Mumbai, thousands of jobs are at risk due to reduced demand and cost escalation in the US market," he added.

Yet, not all experts foresee job losses. "India is largely a domestic consumption-driven economy, unlike China," said TeamLease Services’ Balasubramanian Anantha Narayanan. "At this point in time, we aren't seeing any signs of a slowdown or loss of jobs."

He added that exports to the US comprise just 2.2% of India’s GDP, limiting the fallout to a few sectors. “Pharma and electronics are unlikely to be affected for now. We’ll likely redirect trade to other markets,” he said, pointing to recent FTAs with the UK and other nations.

CIEL HR CEO Aditya Mishra agreed that the tariff uncertainty is unsettling, particularly for export-dependent sectors such as electronics, textiles, auto components, leather, footwear, shrimp, and engineering goods. He also flagged indirect impacts on sectors like pharma due to rising input costs.

Mishra warned that this could have a cascading effect on MSMEs in the supply chain. IT and GCC sectors, already grappling with slow hiring and investments, may also adopt a wait-and-watch approach amid global uncertainty.

Here are some common concers:

How is the US tariff war affecting Indian jobs: It’s putting pressure on export-led sectors, risking up to 3 lakh jobs in industries like textiles and jewellery.

Which sectors in India are most impacted by the US tariff war: Textiles, auto components, gems and jewellery, electronics, footwear, shrimp, and engineering goods are most exposed.

Can the US tariff war cause large-scale job losses in India: While some experts predict immediate job losses in certain sectors, others believe strong domestic demand and trade diversification could limit the overall impact.

What skills are in demand despite the US tariff war: Roles driven by domestic demand — particularly in services, healthcare, and tech — remain resilient. Skills in logistics, automation, and digital services continue to be sought after.

Will the US tariff war create any new job opportunities in India: While direct opportunities may be limited, it could accelerate India’s push for self-reliance and boost jobs in sectors focused on domestic production and alternative export markets.