TCS to Shed 12,000 Jobs This Fiscal, Says AI Isn't the Reason
TCS’s move comes as the Indian IT industry undergoes sweeping changes in response to growing demand for AI, digital transformation, and automation
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Tata Consultancy Services Ltd (TCS) will cut about 2% of its global workforce, or about 12,000 roles, over the course of the current fiscal year, Reuters reported on Sunday, citing a company statement.
The reduction, which primarily targets middle and senior-level roles, is part of a broader strategic transformation aimed at making the IT giant “future-ready,” the statement said.
TCS ended the June quarter with 613,069 employees, and the planned cuts would affect around 12,200 roles.
While the company is investing heavily in employee reskilling, automation, and next-gen infrastructure, TCS emphasized that the layoffs stem from role realignment rather than cost-cutting due to AI.
“This is not because of AI giving some 20% productivity gains. This is driven by where there is a skill mismatch or where we think we have not been able to deploy someone,” CEO K. Krithivasan told Moneycontrol.
TCS said it has so far trained over 550,000 employees in basic AI and over 100,000 in advanced skills, while acknowledging that reskilling hasn’t always led to re-employment.
“Some people, especially at senior levels, find it difficult to transition to tech-heavy roles,” the CEO said.
Over the past two weeks, TCS has let go of about 100 employees in Bengaluru, Mint reported.
The move comes as India’s IT services industry undergoes a wave of restructuring in response to evolving client demands and rapid automation.
Earlier this month, HCL Technologies Ltd flagged potential job reductions linked to automation, while Wipro Ltd has introduced mandatory English-language assessments for senior executives.
TCS’s announcement of layoffs comes at a moment of heightened government scrutiny.
India’s Ministry of Electronics and Information Technology (MeitY) is closely tracking the developments at TCS, given the potential employment impact, Moneycontrol reported.
While shares of TCS fell by up to 1.7% on Monday, reflecting investor concerns over sector-wide macro pressures and slowing demand, those of Infosys and Wipro also saw declines of up to 3.4%.
