In a move that has sent ripples through the Indian IT sector, Tata Consultancy Services (TCS), the country’s largest IT services firm, has announced its decision to lay off approximately 12,000 employees, which accounts for about 2% of its global workforce. This decision, which will primarily impact mid and senior-level employees, is part of a larger restructuring plan to make the company “future-ready and agile” in the face of rapid technological advancements and changing market demands.
The announcement, made on Sunday, July 27, 2025, has sparked a debate about the future of the IT industry and the role of artificial intelligence (AI) in the workforce. While TCS has stated that the layoffs are not solely driven by AI, the company’s focus on deploying AI at scale and the need for new skills have been cited as key factors.
The Reasons Behind the Restructuring
According to TCS CEO K Krithivasan, the decision was driven by the need to address evolving skill demands and challenges in internal redeployment. The company is investing in new technologies and realigning its workforce to meet the needs of a changing market. The layoffs are intended to streamline operations and create a more agile organization.
While the company has emphasized that the move is not a direct result of AI replacing jobs, the increasing adoption of AI and automation is undoubtedly a contributing factor. As routine tasks become automated, the demand for employees with specialized skills in areas like AI, machine learning, and data science is on the rise.
Impact and What’s Next
The layoffs at TCS are a significant development for the Indian IT industry, which has long been a major source of employment. The move could signal a broader trend of workforce restructuring as companies adapt to the changing technological landscape.
TCS has assured that it will support the affected employees with severance pay, extended insurance, and outplacement services. The company has also stated that the transition will be managed carefully to ensure there is no impact on client service.
The news has understandably caused concern among IT professionals. However, it also highlights the importance of continuous learning and upskilling to stay relevant in a rapidly evolving job market.
Sources:
- Financial Express: ‘This is not because of AI’, TCS to lay off 2% of global workforce; 12,000 mid and senior employees hit
- India Today: TCS layoff: What the company is offering to 12,000 affected employees
- Hindustan Times: TCS to lay off over 12,000 employees in major workforce cut
- The Times of India: TCS to lay off around 12,000 employees! Tata Consultancy Services plans 2% workforce cut over the year; what you should know
- Livemint: TCS to lay off over 12000 employees this year; mid, senior level staff to be impacted
- The Economic Times: TCS to cut 2% of workforce, affecting around 12,000 jobs
- The Hindu: TCS to cut workforce by 2%, affecting more than 12,000 jobs
YouTube: - Moneycontrol: TCS is laying off over 12,000 employees this year. Here’s why
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