TCS to Reduce Workforce by 2%, Impacting Over 12,000 Employees
Tata Consultancy Services, or TCS, is one of the biggest IT companies in India. It has over 600,000 employees worldwide. But now, the company is planning to cut down 2% of its workforce. That means more than 12,000 people could lose their jobs.
Why is this happening? That’s the big question. Many of us have seen big changes in the tech world lately. From AI taking over simple tasks to clients cutting down budgets, the IT industry is going through a shift. And TCS is not alone. Other tech giants are also making similar moves.
Let’s find out why TCS is doing this, who it affects, and what it means for the future. We’ll also talk about how this fits into the bigger picture of the global tech job market.
Background on TCS and Workforce Size
Tata Consultancy Services, or TCS, is one of the world’s largest IT service firms. It employs over 613,000 people globally as of June 2025. The company operates in more than 50 countries and has over 500 offices across major markets like the US, UK, India, and Australia. TCS has long been seen as a stable employer in the IT space.
Reasons Behind the Layoffs
We know that TCS plans to cut roughly 2 percent of its workforce, affecting around 12,200 roles, mainly at the middle and senior levels. The company says it is adapting to a changing market with unstable demand and delays in client decisions and project starts.
While TCS insists AI is not the direct cause, it says rising automation and new tech demands mean certain skills are less needed now. The goal is to become more agile and build teams for future needs.
The company claims it will retrain and redeploy staff wherever possible, even as it enters new markets and integrates AI at scale.
Departments and Geographies Affected
The layoffs will affect middle and senior management the most. That includes managers across domains who may not fit the new skill model. We expect impact across global offices, not limited to India only.
Freshers and juniors appear safe for now. The moves aim to realign talent, not cut entry-level roles.
Employee Reactions and Internal Responses
Social media and forums show anxiety. On Reddit, one user commented:
Others noted that AI is now writing 40-50 percent of code, reducing human workload. Employees on the bench feel especially uncertain. A new benching policy limits unassigned days, raising fears of termination even for those waiting for projects.
Industry‑Wide Context
TCS is not alone. Across India’s $283 billion IT services sector, companies are delaying new hires and repurposing staff. Clients hold back on non-essential tech spend amid inflation and trade policy uncertainty.
Analysts at HFS Research point out that AI is transforming the traditional labor-heavy service model. They say companies must realign headcount to stay competitive with lower prices.
Infosys, Wipro, Accenture, and others have also hinted at slow hiring and cautious spending this year.
TCS’s Future Strategy and Outlook
TCS leadership says the layoffs are hard, but are needed to become a future‑ready, agile firm. They emphasize retraining, reskilling, and moving people into areas like AI, cloud, and digital transformation.
We understand TCS plans to focus on entering new markets, winning clients with next‑gen tech, and deepening partnerships. The goal is to raise operating margins from around 24.5 percent back toward 26-28 percent levels.
Impact on Stakeholders
Investors are watching closely. The cuts signal TCS taking charge of costs and smart restructuring. Its market cap remains healthy, but margins matter.
Clients should receive no service disruption, says TCS. The company has promised careful transition planning so that client delivery is not affected.
Industry regulators have not yet weighed in. Analysts see this as a shift in mindset big IT firms now face evolving demand and digital transformation headwinds.
TCS Layoffs: Bottom Line
We see that TCS is acting in response to major shifts in technology and global demand. A 2 percent cut equals more than 12,000 employees, mostly mid- and senior-level. This is not a shock but part of a strategic adjustment.
The company plans to retrain staff and ensure client service stays strong. We think this move reflects a broader trend: IT firms adapting to AI, automation, and tighter client budgets.
We will watch how TCS handles reskilling and growth in new tech areas. The message is clear: upskilling and flexibility will matter more than ever in the changing world of IT.
Frequently Asked Questions (FAQ)
TCS announced in late July 2025 that it would cut 2% of jobs because of weak demand, AI automation, and client delays in project decisions.
By June 2025, TCS had about 613,000 employees worldwide. This makes them one of the largest IT service firms in India and the world.
Disclaimer:
This is for information only, not financial advice. Always do your research.