TCS (TATA Consultancy Services), India’s largest IT services company, has taken a decision that will be part of a significant development for India’s tech sector. TCS is set to lay off more than 12,000 employees. This decision comes as part of a massive internal restructuring effort and will affect around 2% of the company’s workforce.
A Wake-Up Call From the Top
With a total headcount of over 600,000 employees (six lakh) as of June 2025, TCS is one of the largest private-sector employers in India and a giant in the global IT sector. But now, it’s making headlines for a very different reason—cutting jobs, particularly in its mid- and senior-level roles.
Speaking to Moneycontrol, TCS CEO K. Krithivasan clarified the reason behind the decision. Contrary to popular belief, this isn’t about artificial intelligence replacing humans—at least not directly. Instead, Krithivasan pointed to a growing “skill gap.” According to him, TCS has been unable to effectively redeploy certain employees whose current skill sets no longer align with the company’s evolving needs.
“This is not about reducing the number of people because of AI or automation,” Krithivasan said. “It’s about the inability to reassign people into roles that need different skills.”
Who Is Affected?
Mid-level to senior professionals are targeted in this layoff and these are employees who have been working in this company for many years holding project management or specialist roles. Their experience, while valuable, may no longer match what’s now in demand—especially as digital transformation, cloud computing, and data analytics reshape the IT services landscape.
This workforce adjustment won’t happen overnight. TCS plans to implement the changes gradually over the course of the current financial year, which runs until March–April 2026.
Severance Support on the Table
To soften the impact, TCS will offer a severance package to affected employees. This includes the standard notice-period pay and other additional benefits, though specifics of the package have not yet been made public.
While that may provide temporary financial relief, for thousands of employees—many with families, mortgages, and years of service—this news is still a heavy blow.
Why It Matters Beyond TCS
TCS being India’s largest company, its decision has caused a great stir in the IT industry. Often seen as a bellwether for the sector, TCS’s actions could influence what other companies do next. If skill gaps and redeployment challenges are a problem at the top, smaller and mid-tier firms may face similar, or even more acute, pressures.
This move also raises larger concerns about the stability of white-collar employment in India, especially in tech—a sector long considered a pathway to upward mobility for millions. With digital skills evolving rapidly, the gap between current employee capabilities and future needs seems to be widening faster than many companies can manage.
The Bigger Picture: Skills Over Stability?
Technology is moving so fast that even a normal person now looks for and uses simple technology in anything. That is why tech employees have to keep themselves up to date.
It’s clear that the traditional model of stable, long-term employment in IT is being disrupted. Technology is moving faster than many workers can upskill. TCS’s restructuring is a reminder that having a job today is no guarantee of having one tomorrow—unless your skills are up to date.
For employees, this means continuous learning is no longer optional. For companies, it signals a need to invest more aggressively in internal reskilling and training initiatives. And for job seekers, especially in mid-career, it may be time to reassess professional goals and consider acquiring in-demand skills like cloud engineering, AI/ML, cybersecurity, or data science.
What’s Next?
While the TCS layoffs are a sobering reminder of the shifting job landscape, they also offer a window into how the future of work is shaping up in India. Companies are no longer just looking for experience—they want adaptability, digital fluency, and a readiness to evolve.
Whether other IT giants follow suit remains to be seen, but the message is clear: in a tech-driven world, standing still is not an option—even for giants like TCS.
Stay updated with UState Pulse.