Narayana Murthy's Infosys, Ratan Tata's TCS, or HCL: IT giants secretly using this formula for…, it's impacting employees due to…
Seems like IT giants are on a layoff spree. First, IBM laid off 8,000 employees, and then Microsoft fired 9,000 IT professionals. Now, one of India's largest IT companies, TCS has laid off over 12,000 employees. This has happened when Indian IT companies' earnings have remained stable or have increased. These IT giants are moving away from the 'more people, more growth' formula and adopting the 'less people, more output' strategy. It is a bad time period for employees' perspective as these companies are continuously doing layoffs in large numbers, on the other hand, they have also stopped hiring, directly affecting freshers. IT giants like Infosys, Wipro and HCL are also included in these companies. They have slowed down fresh recruitment in recent months.
Why IT Companies Laying Off Employees Even After Earning Profits?
Notably, in the first quarter of the financial year 2026, in the month of April-June 2025, Ratan Tata's TCS reported revenue of Rs 63,437 crore which is an increase of 1.3 percent. Its profit also increased by 5.9 percent. On the other hand, Infosys's revenue increased by 7.5 percent to Rs 42,279 crore.
Talking about earnings, IT giant HCL performed better than other IT companies, showing growth of 8.1 percent. Notably, the companies reduced the workforce during these periods but their numbers remained stable.
TCS began FY26 with a challenging quarter and fired more than 12,000 employees, 2 percent of its workforce. Infosys recruited only 15,000 trainees in FY 2025, a decrease compared to previous years. Similarly, HCLTech has slowed down its hiring process.
This move indicates that while IT companies are earning profits, their employee numbers are not increasing.
What Is The Real Reason Behind The Job Cuts?
The two major reasons behind the reduction of employees are – trend of AI and the breakdown of the pyramid model in recruitment.
Impact of AI and automation: TCS, Infosys, and HCLTech are using AI and Gen AI to complete their tasks. This step has increased the speed and efficiency of work but also reduced the workforce.
According to TCS CEO K Krithivasan, the ways of working are changing; we have to be prepared for the future. That is why we have implemented AI on a large scale.
Breaking Of The Pyramid Model: Companies used to follow the pyramid model—recruiting more people from the bottom (like freshers) and less at the top level. As AI is doing all the basic work itself, companies are moving towards skill-based hiring.
Amid all this, getting a job has become more difficult for freshers. Companies like Infosys have made the training and selection process more stringent.
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