Tata Consultancy Services (TCS), India’s largest IT services firm, on Sunday said it would trim around 2% of its workforce or roughly 12,200 jobs in the 2026 financial year, primarily affecting middle and senior management.
The move, the company said, aligns with its evolving business model powered by artificial intelligence and automation, amid an uncertain demand environment.
The announcement, which came in a company statement cited by Reuters, marks a significant shift in the hiring philosophy of TCS, which employs over 6.13 lakh people.
“This transition is being planned with due care to ensure there is no impact on service delivery to our clients,” the statement said.
Sector experts view the decision as emblematic of broader shifts in the \$283 billion Indian IT industry, where client budgets are shrinking and AI is disrupting the traditional people-heavy model.
Phil Fersht, CEO of IT advisory firm HFS Research, noted that providers like TCS are “rebalancing their workforces to maintain profit margins” in a market where clients are demanding 20–30% cost reductions. “The decision by TCS, considering its culture of being a stable place to work, highlights this sectoral trend,” he said.
TCS CEO K Krithivasan recently flagged delays in client decision-making and project initiations, contributing to the cautious outlook.
The job cuts have sparked concern online. “If TCS is laying off, what will be the situation in other IT firms? Looks horrible,” wrote an X user. Another added: “The AI threat is not coming anymore. It’s already here.”
On Reddit and X, users expressed alarm at the erosion of job security and critiqued internal talent management practices, alleging that employees with strong technical expertise were underutilised in support roles.
Meanwhile, in a separate but related development, the Union Ministry of Labour and Employment has summoned TCS to appear before the Chief Labour Commissioner (CLC) in Delhi on August 1 over delays in onboarding more than 600 experienced lateral hires, Business Standard reported.
The move follows a complaint by Nascent Information Technology Employees Senate (NITES), which alleged that TCS had issued offer letters and formal communication to the candidates but failed to provide joining dates.
The ministry’s letter, addressed to the TCS chairman and managing director, asked the company to send a senior representative “well conversed with the matter and authorised to take decisions” to the meeting.
NITES has urged the ministry to secure a time-bound commitment from TCS on the onboarding process, suggest alternative internal roles for the affected professionals, and consider compensation for the delays.