Tata Consultancy Services (TCS), India’s largest IT services firm, is set to reduce its global workforce by approximately layoffs 12,261 TCS employees by July 2025. This figure represents about 2% of its total workforce, which stood at over 6.1 lakh employees as of June 2025. This move marks the company’s largest layoff to date and signals a major strategic shift within the organization.
Why the Layoffs?
TCS attributes this significant restructuring to a need for a “future-ready” organization, driven by evolving business dynamics and market uncertainties. While some industry observers point to AI disruptions and a tough demand environment, TCS CEO K Krithivasan stated that the layoffs are primarily due to skill mismatches and the inability to redeploy certain roles effectively within the firm’s changing operational structure. He emphasized that the decision is not directly due to AI-led productivity gains replacing jobs.
Who is Affected?
The job cuts will mainly affect mid-level and senior executives. This reflects a shift towards embracing AI and automation, where roles requiring updated skills are becoming paramount. The company has invested in reskilling programs, training over 5.5 lakh employees in basic digital skills and 1 lakh in advanced areas. However, successful redeployment for all, especially at senior levels, has proven challenging.
Impact of TCS Layoffs 2025
This workforce reduction, a rare occurrence for a company like TCS, underscores the challenging demand environment in the IT sector. The move also follows changes in TCS’s internal deployment policy, requiring employees to maintain a minimum of 225 billable days per year. The company now limits time spent on the bench to 35 days annually.
TCS CEO K Krithivasan acknowledged the difficulty of this decision in an email to employees. The company supports those affected through this transition with benefits, outplacement assistance, and counseling. This restructuring is part of a broader strategy to realign resources towards high-growth areas, including AI deployment and new technologies.
