India’s largest IT services company, Tata Consultancy Services (TCS), is set to cut its workforce by approximately 2 per cent next year, impacting over 12,000 employees. In an interview with Moneycontrol, the company’s CEO K. Krithivasan stated that the decision aligns with the company’s strategy to make TCS “more agile and future-ready”, especially in the face of rapidly changing technological conditions. Below are the details of the employee levels affected by this decision.
The company’s CEO K. Krithivasan told Moneycontrol in an interview that the move is part of a strategy to make TCS “more agile and future-ready”, especially in the face of rapidly changing technological conditions.
When asked the reasons for reducing the workforce, Krithivasan said the entire industry is changing. He said working styles are changing and every company needs to be future-ready and flexible. “We are constantly working on new technologies such as AI and changes in operating models,” he said.
The company has adopted AI on a large scale and is also evaluating the skills required in the future. “We have invested heavily in providing career development and deployment opportunities to employees,” he said. However, he also admitted that redeployment did not prove effective in some areas, leading to the decision to layoff.
As of June 2025, TCS had a total of 6,13,000 employees worldwide. A 2 per cent reduction would equate to about 12,200 jobs. The CEO clarified that layoffs will mostly be focused on middle management and senior employees, while junior staff will be less affected. Krithivasan also said that the move is not directly due to AI but to improve skills as per future needs. “It is linked to the feasibility of deployment, not with the aim of reducing headcount.”
Still, experts believe that AI is gradually impacting demand in the sector. As automation is reducing the need for roles like manual testing, many senior employees are finding it difficult to adapt to new technologies. This problem is not limited to TCS; In the last two years, many large corporates have adopted AI-based automation by eliminating roles, though this is not openly acknowledged.
With regard to TCS’ upcoming layoffs, the CEO confirmed that the affected employees will be provided severance packages, notice period pay, extended health insurance and outplacement assistance. Explaining the company’s new ‘bench management’ policy, in which employees wait for new projects without assignments, Krithivasan said, “This is not an attempt to increase efficiency, but we want to ensure that employees find projects and remain productive throughout the year. It is a positive pressure and incentive so that they remain active in client projects.”
Despite the layoffs, TCS has grown its workforce in the April-June quarter, adding 6,071 new employees. Overall, the company’s employee count increased by 5,090 in the period. However, the upcoming layoffs are an indication that TCS is now focused more on numbers than on connecting its vast talent pool with the required skills demanded by the fast-changing tech world.
