Latest news with #Mumbai-headquartered
Saudi Gazette
17 hours ago
- Business
- Saudi Gazette
India's AI-driven tech firings could derail middle class dreams
MUMBAI — India's showpiece software industry is facing a moment of reckoning. The country's biggest private sector employer Tata Consultancy Services (TCS), also its largest IT services company, has announced it will cut more than 12,000 jobs at middle and senior management levels. This will reduce the firm's workforce by 2%. The Mumbai-headquartered software behemoth employs over half-a-million IT workers and is considered a bellwether for business sentiment across India's $283bn software industry. It forms the backbone of formal, white-collar employment in the country. The decision, TCS says, was taken to make the company "future ready" as it invests in new areas and deploys artificial intelligence at scale amid seismic disruptions in its traditional business model. Companies like TCS have, for decades, relied on cheap skilled labour to produce software for global clients at lower costs, but this has been upended by AI automating tasks and clients demanding more innovative solutions, rather than just cost savings on manpower. "A number of re-skilling and redeployment initiatives have been under way," TCS said in a statement, adding it will be "releasing associates from the organisation whose deployment may not be feasible". "Across IT companies, people managers are being let go while the doers are being kept to rationalise the workforce and bring in efficiencies," Neeti Sharma, CEO of staffing firm TeamLease Digital told the BBC. She added that "there's been a massive spike" in emerging tech hiring in areas such as AI, cloud, data security, but it is not at the same intensity at which people are being fired. TCS's announcement also highlights the sharp "skills mismatch" in the country's software industry, experts say. As generative AI leads to a rapid enhancement of productivity, "this technology shift is forcing businesses to reassess their workforce structure and analyse if resources should be redirected toward roles that complement AI capabilities," Rishi Shah, economist with Grant Thornton Bharat told the BBC. According to the industry body Nasscom, India needs a million AI professionals by 2026, but not even 20% of the country's IT professionals are AI-skilled. While up-skilling spends by tech companies have significantly spiked as they rush to prepare a new pool of AI talent for the future, those without the requisite skills are being shown the door. Besides the structural shifts brought about by the advent of AI, TCS's announcement also "reflects the broader growth challenges being faced by India's IT sector", according to global investment banking firm Jeffries. "Aggregate net hiring at industry level has been weak since FY22 [financial year 2022], mainly due to the prolonged moderation in demand outlook," Jeffries said in a note. Demand for IT services in the US – which contributes to half of the revenue for Indian software majors - has been impacted by Donald Trump's tariffs. While tariffs chiefly target physical goods, analysts say companies are pausing on discretionary IT spending as they reconsider the economic impact of tariff uncertainties and their global sourcing strategies. Rising AI adoption is also driving US companies to negotiate lower costs, forcing people heavy IT firms to work with fewer employees, according to Jeffries. The ripple effects of this have begun to be felt in cities like Bengaluru, Hyderabad and Pune – once epicentres of India's IT boom. Some 50,000 people in the industry lost their jobs last year, according to one estimate. And there was a 72% drop in net employee additions at India's top six IT services companies. All of this could have cascading effects on India's broader economy, which has struggled to create jobs for the millions of young graduates that enter the workforce every year. In the absence of a strong manufacturing sector, these software companies - which made India the world's back office in the 1990s - were the preferred employment option for hundreds of thousands of new IT workers. They birthed a new, affluent middle class, spawning growth in many cities and fueling demand for cars and homes. But as stable, well-paying jobs shrink, there are now questions over India's services-led economic boom. Until just a few years ago, India's IT majors would absorb 600,000 fresh graduates every year. In the last two years, that number has dramatically fallen to about 150,000, according to TeamLease Digital. Other emerging sectors such as financial technology startups and GCCs (global capability centres) – which are off-shore units of multinational companies that perform supporting tasks like IT, finance or research and development - are absorbing the rest, but at least "20-25% of fresh graduates will have no jobs," says Ms Sharma. She adds that the "GCCs will never match the volume of hiring that the IT companies did". Several top business leaders in India have begun flagging the economic consequences of these trends. India's trimmed down IT sector could "negatively impact many allied services and industries, crash real estate and give a big blow to premium consumption," D Muthukrishnan, one of south India's largest distributor of mutual-funds wrote on X, reacting to TCS's announcement. A few months ago Arindam Paul, entrepreneur and founder of the motor technology company Atomberg, warned of the potentially crippling impact of AI on India's middle class in a LinkedIn post. "Almost 40-50% white collar jobs that exist today might cease to exist," Paul wrote. "And that would mean the end of the middle class and the consumption story." How quickly Indian tech giants adapt to the gamut of disruptions being brought by the AI revolution will decide whether the country can retain its edge as a global technology player. And whether it can expand its consuming middle-class that can keep its GDP growth on track. — BBC
Economic Times
2 days ago
- Business
- Economic Times
TCS layoffs: Jobs cut due to skill mismatch, not AI automation, says CEO K Krithivasan
TCS layoffs 2025: Tata Consultancy Services (TCS) announced plans to cut about 2% of its global workforce, or roughly 12,000 employees, on Sunday. But the company's CEO, K Krithivasan, says this is not because of artificial intelligence replacing jobs for efficiency gains. Krithivasan told Moneycontrol in an interview that the job cuts are due to a 'skill mismatch' and stressed that TCS will continue searching for high-quality talent. In a statement to ET on Sunday, the IT major said, 'TCS is on a journey to become a future-ready organisation… As part of this journey, we will also be releasing associates from the organisation whose deployment may not be feasible. This will impact about 2% of our global workforce, primarily in the middle and the senior grades, over the course of the year.' TCS also confirmed that affected employees will be paid for their notice periods and receive a severance package. In addition, the company plans to offer extended insurance benefits and outplacement support to help those of June end, the Mumbai-headquartered Tata subsidiary had a workforce of 613, company stressed that the transition is being carefully managed to avoid any disruption to client services.'We understand that this is a challenging time for our colleagues likely to be affected. We thank them for their service and we will be making all efforts to provide appropriate benefits, outplacement, counselling, and support as they transition to new opportunities,' the company shares dipped nearly 2% on Monday, reaching an intraday low of Rs 3,081.6 on the decision to lay off staff comes shortly after multiple TCS employees lodged legal complaints over the company's revised bench policy, which limits employees to 35 days without project deployment annually, and requires a minimum of 225 billable days each year. Also Read: TCS layoffs: IT major to mass fire 12,000 senior, mid-level staffers amid AI push
Economic Times
3 days ago
- Business
- Economic Times
TCS to cut 2% of workforce, affecting around 12,000 jobs
Reuters India's largest IT exporter, Tata Consultancy Services (TCS), has decided to lay off around 2% of its workforce, or roughly over 12,000 employees, over the year as macro uncertainties and AI-led technology disruptions continue to hit business of June end, the Mumbai-headquartered Tata subsidiary employed a workforce of 613,069. 'TCS is on a journey to become a future-ready organisation… As part of this journey, we will also be releasing associates from the organisation whose deployment may not be feasible. This will impact about 2% of our global workforce, primarily in the middle and the senior grades, over the course of the year,' the IT giant said in a statement to ET. 'This transition is being planned with due care to ensure there is no impact on service delivery to our clients… We understand that this is a challenging time for our colleagues likely to be affected. We thank them for their service and we will be making all efforts to provide appropriate benefits, outplacement, counselling, and support as they transition to new opportunities,' the company affected employees will receive payments for their notice periods along with an additional severance package. TCS will also look to extend insurance benefits and offer outplacement opportunities for the impacted layoff decision comes days after several TCS employees filed legal complaints against the company's recently tweaked employee bench policy, which allows employees only 35 annual days without being deployed on a project and to maintain at least 225 billable days software services companies, with a cumulative revenue of over $283 billion, are among the largest private sector employers, with TCS being the Friday, ET reported that job additions at the top six IT majors saw a decline of over 72% with a mere 3,847 employee additions in the April-June quarter, a drop from 13,935 people who were hired by the six firms in the March also stated it is making strategic initiatives on multiple fronts, including investing in new-tech areas, entering new markets, deploying AI at scale for our clients and ourselves, deepening our partnerships, creating next-gen infrastructure and realigning our workforce this, a number of reskilling and redeployment initiatives have been underway. Elevate your knowledge and leadership skills at a cost cheaper than your daily tea. From near bankruptcy to blockbuster drug: How Khorakiwala turned around Wockhardt Can Chyawanprash save Dabur in the age of Shark-Tank startups? Why Air India could loom large on its biggest rival IndiGo's Q1 results Apple has a new Indian-American COO. What it needs might be a new CEO. How India's oil arbitrage has hit the European sanctions wall Central banks' existential crisis — between alchemy and algorithm Short-term valuation headwinds? Yes. Long-term growth potential intact? Yes. Which 'Yes' is more relevant? Stock Radar: This smallcap stock breaks out from Flag pattern to hit fresh record high in July 2025; time to buy or book profits? For long-term investors: A moat of a different kind; 5 large-cap stocks with an upside potential of up to 38%
Time of India
3 days ago
- Business
- Time of India
TCS to cut 2% of workforce, affecting around 12,000 jobs
Tata Consultancy Services (TCS) plans to lay off approximately 2% of its workforce, impacting over 12,000 employees, due to macro uncertainties and AI-driven disruptions. The company will provide severance packages, outplacement services, and extended benefits to affected employees. This decision follows a decline in job additions across major IT firms and strategic initiatives by TCS to realign its workforce. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads India's largest IT exporter, Tata Consultancy Services TCS ), has decided to lay off around 2% of its workforce, or roughly over 12,000 employees, over the year as macro uncertainties and AI-led technology disruptions continue to hit business of June end, the Mumbai-headquartered Tata subsidiary employed a workforce of 613,069.'TCS is on a journey to become a future-ready organisation… As part of this journey, we will also be releasing associates from the organisation whose deployment may not be feasible. This will impact about 2% of our global workforce, primarily in the middle and the senior grades, over the course of the year,' the IT giant said in a statement to ET.'This transition is being planned with due care to ensure there is no impact on service delivery to our clients… We understand that this is a challenging time for our colleagues likely to be affected. We thank them for their service and we will be making all efforts to provide appropriate benefits, outplacement, counselling, and support as they transition to new opportunities,' the company affected employees will receive payments for their notice periods along with an additional severance package. TCS will also look to extend insurance benefits and offer outplacement opportunities for the impacted layoff decision comes days after several TCS employees filed legal complaints against the company's recently tweaked employee bench policy, which allows employees only 35 annual days without being deployed on a project and to maintain at least 225 billable days software services companies, with a cumulative revenue of over $283 billion, are among the largest private sector employers, with TCS being the Friday, ET reported that job additions at the top six IT majors saw a decline of over 72% with a mere 3,847 employee additions in the April-June quarter, a drop from 13,935 people who were hired by the six firms in the March also stated it is making strategic initiatives on multiple fronts, including investing in new-tech areas, entering new markets, deploying AI at scale for our clients and ourselves, deepening our partnerships, creating next-gen infrastructure and realigning our workforce this, a number of reskilling and redeployment initiatives have been underway.
Mint
3 days ago
- Health
- Mint
Sun Pharma, Lupin, Dr Reddys recall products in US market
New Delhi, Domestic drug majors Sun Pharma, Lupin and Dr Reddy's Laboratories are recalling drugs in the US market due to manufacturing issues and product mix up, according to the US health regulator. As per the latest Enforcement Report of US Food and Drug Administration , the Mumbai-headquartered Sun Pharmaceutical Industries is recalling 5,448 bottles of a generic medication in the US. Princeton-based Sun Pharmaceutical Industries Inc is recalling the affected lot of Lisdexamfetamine Dimesylate capsules due to "Failed Dissolution Specifications", the US health regulator stated. The medication is used to treat attention deficit hyperactivity disorder . The drug firm initiated the Class II recall in the US on June 16 this year, it added. Another Mumbai-based drug maker Lupin is recalling 58,968 bottles of a generic combination medication used to treat high blood pressure. Naples-based Lupin Pharmaceuticals Inc is recalling Lisinopril and Hydrochlorothiazide tablets . The affected lot was manufactured at the company's Nagpur-based manufacturing facility. As per the USFDA, the company initiated the Class II recall on June 20 due to "Product Mix Up". This product is being recalled because of a complaint received that a sealed bottle of lisinopril and hydrochlorothiazide tablets 20mg/12.5 mg had a foreign tablet identified as atazanavir and ritonavir tablet 300mg/100mg, the US health regulator stated. In another filing, the US health regulator said that Dr Reddy's Laboratories is recalling 1,476 bottles of Omeprazole Delayed-release capsules. The medication is used to treat certain stomach and esophagus problems. Princeton-based Dr. Reddy's Laboratories, Inc initiated the Class II recall on June 30, 2025, USFDA stated. The affected lot was produced at the company's Bachupally -based manufacturing facility. The recall is due to the presence of foreign tablets/capsules, USFDA said. It is due to the presence of foreign Divalproex Sodium extended-release 250mg tablets in a bottle of omeprazole capsules, it added. As per the USFDA, a Class-II recall is initiated when the use of, or exposure to, a violative product may lead to temporary or medically reversible health consequences, or when the likelihood of serious adverse health outcomes is minimal.
