New Delhi, April 29 -- India's outsourcing industry, its largest white-collar employer, is a juggernaut that has all but stopped moving. The dollar revenue at the top five software-services exporters has grown slower than 3% for 10 straight quarters-a shadow of the double-digit expansion in the previous two decades.

As these companies squeeze hiring to survive the existential challenge posed by artificial intelligence (AI), the aftershocks are starting to upend everything from real-estate demand to mortgage-underwriting norms.

Last week, Infosys forecast a much slower pace of increase in sales than analysts had been expecting. At HCL, revenue for the March quarter declined from the previous three months.

After a four-month $115 billion...