India's biggest IT services company, Tata Consultancy Services (TCS), revealed a major job reduction. CEO K. Krithivasan affirmed that the company will decrease its worldwide staff by 12,261 staff members in the fiscal year 2025-26. The number accounts for around 2% of its 6,13,069 workforce. The job cuts are primarily on account of economic uncertainty worldwide and the sudden growth of artificial intelligence (AI). TCS said it was gearing up to meet future requirements by upskilling employees on newer technologies. Still, certain positions will be eliminated where alternatives are not suitable. The job cuts are likely to hit mid- and senior-level managers predominantly.
Why TCS Is Cutting Jobs
India's IT services industry has touched $283 billion (roughly ₹25 lakh crore) in business. TCS is the largest player here and has the highest number of employees in the industry. Because of the dip in global demand and the disruptive effect of AI, IT firms are facing stress. Several clients are now asking for a reduction of 20-30% in project expenses. To preserve profit margins, TCS is reorienting its workforce. As of June 2025, TCS employed 6,13,069 people. With 12,200 employees to be laid off, experts in the industry opine that other firms may follow suit.
CEO's Remarks Regarding the Layoffs
CEO Krithivasan mentioned that firing employees was among the most difficult decisions for the company. He elaborated that AI is bringing significant changes. To remain competitive, the company is evaluating employee skills by employing AI tools. He also made it clear that the lay-offs will not influence current projects. TCS ensured that the employees who will lose their jobs will get benefits, placement support, and increased insurance.
Updated Bench Policy
TCS has altered its bench policy. Now, employees must be allocated projects for a minimum of 225 days per year. The maximum number of days off without a project (on bench) is restricted to 35 days. The news of the layoffs came after court cases initiated by some TCS employees against this policy.
IT Sector Hiring Trends
In April-June 2025, recruitment by India's top six IT companies fell 72% year-on-year. The companies recruited 3,847 individuals in the quarter, compared to 13,935 a year earlier.
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