TCS Layoffs 2025: A Watershed Moment for India’s IT Behemoth
In late July 2025, Tata Consultancy Services (TCS), India's largest IT services firm, announced plans to lay off approximately 12,000 employees, representing about 2% of its global workforce of over 613,000 employees. Spread over the financial year 2026 (April 2025–March 2026), this marks the largest workforce reduction in TCS’s nearly 57‑year history.
Why is TCS Cutting Jobs?
- Skill Mismatch over AI Takeover: CEO K. Krithivasan clarified that the layoffs are due to “skill mismatches,” not AI automation.
- Technology Shift: TCS is moving toward agile, AI-driven models and away from traditional hierarchical structures.
- Weak Demand: Global economic uncertainty and reduced IT spending are pressuring margins.
- Investor Concerns: TCS stock has dropped ~25% in 2025, signaling concerns about long-term execution risks.
Who’s Likely to Be Impacted?
- Primarily mid-level and senior employees, especially where deployment is not possible.
- Some junior employees who have been on bench for extended periods.
- No specific regions have been identified as more affected than others.
Response, Relief and Legality
- Compensation: Affected employees will receive severance, insurance coverage, and outplacement support.
- Union Opposition: Employee unions like FITE have called the move unethical and urged legal resistance.
- Compliance: TCS asserts that all layoffs are handled legally and ethically.
Broader Implications for Indian IT
This move signals a shift in Indian IT’s job security paradigm. Once considered stable, TCS’s restructuring hints that no job is safe amid AI disruption, digital transformation, and economic headwinds.
- Competitors like Infosys, Wipro, and HCLTech may follow suit.
- Skills and adaptability are now more valuable than years of experience.
What’s Next?
- Employees: Must proactively reskill in AI, cloud, and agile delivery.
- Job Seekers: Should highlight relevant, current tech skills over managerial experience.
- Regulators: Must ensure fair treatment and legal compliance in the restructuring process.
Conclusion
TCS’s decision to lay off 12,000 employees marks a turning point in Indian IT. While positioned as a future-proofing measure, it also underscores the pressing need for reskilling, continuous learning, and policy oversight. This restructuring is not just a corporate action—it’s a message for every IT professional to stay relevant, agile, and prepared.
