More than 12,000 employees will lose jobs in TCS; AI has taken their place

This step is being taken at a time when the entire IT sector is going through a phase of reduced demand, global uncertainties and technological changes.

New Delhi: TCS, the country's largest IT company, Tata Group, has announced large-scale layoffs next year. The company has announced layoffs of 2 percent of its workforce i.e. more than 12,000 employees in the financial year 2026. This layoff will have the greatest impact on mid and senior level employees. This step is being taken at a time when the entire IT sector is going through a phase of reduced demand, global uncertainties and technological changes.

The layoff move of TCS will affect employees of all the countries and regions where this company works. This process will be applicable till the financial year 2026 (April 2025 to March 2026). In the quarter ended June, the number of employees of TCS was 6,13,000. Therefore, about 12,200 employees will be affected by the 2 percent cut.

Know why TCS is retrenching employees
TCS says that it is retraining its employees in new technologies and AI skills so that they can be deployed in the company's new business areas. But despite this, some positions are no longer necessary, whose removal is part of the company's strategic plan. The company further said that this change is being planned with utmost care, so that it can be ensured that there is no impact on the service provided to our customers.

TCS CEO K. Krithivasan said in an interview, we are moving towards new technology, especially AI and changes in the operating model. This is changing the way of working and we have to make ourselves more agile and ready for the future. The CEO has described it as "the most difficult decision of my career so far". He recently admitted that clients are hesitant to start new projects and their decisions are constantly being delayed.

Clouds of crisis on the IT sector
India's $283 billion IT sector is currently facing many challenges. Weak demand from major markets like the US and Europe, delays in business decisions, inflation and policy uncertainty have led to a slowdown in projects.