TCS Plans 2% Workforce Cut Amid Restructuring
India’s largest IT services company, Tata Consultancy Services (TCS), has announced plans to reduce its global workforce by approximately 2%, which amounts to over 12,000 jobs. The decision is part of a broader strategic shift aimed at aligning operations with emerging technologies and changing market dynamics. The company, which currently employs over 613,000 people worldwide, clarified that the reduction will mostly impact mid-level and senior roles that are either redundant or unable to transition to new business needs.
Move Driven by AI and Economic Pressures
TCS stated that this workforce rationalization is not solely due to artificial intelligence replacing jobs but rather a result of changing project demands, cost optimization, and automation trends across industries. Clients are increasingly asking for lower-cost solutions, and TCS is responding by reconfiguring teams and embracing more efficient models. While the company continues to invest in training and reskilling employees, not all roles are adaptable, leading to the need for cuts.
Support for Impacted Employees
For those impacted, TCS has promised full compliance with contractual obligations, including notice period pay and severance packages. Additional support measures such as extended medical insurance and career counseling have been planned to ease the transition. The company emphasized that no disruption to client services is expected and that employee exits will be managed in phases through FY26.
Industry Context and Future Outlook
The announcement reflects a broader trend in India’s IT sector, where companies are under pressure to stay competitive amid shrinking global tech budgets and rapid technological evolution. Other major firms have already undertaken similar restructuring. Despite the cuts, TCS reaffirmed its commitment to hiring fresh talent and focusing on high-value services in AI, cloud, and analytics. The company views this move as necessary to remain agile and future-ready.
