TCS Overhaul Impacts IT Employment as Peers Maintain Hiring Momentum
The Indian IT sector is witnessing a divergent trend in employment, with Tata Consultancy Services (TCS) undergoing a significant restructuring that has led to job reductions, while other major players like Infosys, Wipro, HCL Technologies, and LTIMindtree continue to expand their workforce. Data analysis reveals that despite TCS and Tech Mahindra reporting substantial declines in employee numbers, the top six IT firms collectively shed fewer than 1,500 jobs on a net basis during the first nine months of the financial year 2025-26.
Infosys Leads the Charge in Fresher Recruitment
Infosys has emerged as the frontrunner in hiring, adding 13,456 employees to its payroll so far in FY25-26. Salil Parekh, Managing Director and Chief Executive Officer of Infosys, expressed confidence in the market demand, stating, "I think it demonstrates that we have confidence in where the market is and what we are seeing in terms of the demand." The company is progressing towards its goal of hiring 20,000 freshers this year, with approximately 18,000 already onboarded. Jayesh Sanghrajka, CFO of Infosys, highlighted this as an investment in future capacity, noting that many new hires are under training, which temporarily affects utilization rates.
Wipro's Strategic Growth and Cautious Outlook
Wipro has contributed to the positive hiring trend by adding over 8,500 jobs in the current financial year. This growth is attributed to strategic factors, including the completion of the acquisition of Digital Transformation Solutions in December 2025 and a long-term partnership with the Phoenix Group in the UK. Srini Pallia, MD and CEO of Wipro, reassured that from a supply perspective, hiring is not a challenge, with attrition rates remaining low at around 2%. However, he cautioned about demand uncertainties, particularly in discretionary spending by clients, which could cloud the hiring outlook. "There is no significant change in the demand environment, specifically the discretionary spend as uncertainty continues," Pallia remarked, indicating that customers are in a wait-and-watch mode regarding their budgeting processes.
TCS Restructuring: A Nuanced Perspective on Job Losses
TCS reported a net reduction of 25,816 employees in the first three quarters of FY25-26, a figure that includes voluntary exits alongside restructuring-related releases. The company's restructuring initiative, focused on cost optimization and increased AI adoption, has led to targeted workforce adjustments. Sudeep Kunnumal, Chief Human Resources Officer at TCS, clarified that only 1,800 employees were released in the October-December quarter, despite a net headcount decline of over 10,000. "Wherever we are not finding success in re-deployment, is where we are releasing the workforce... And in this quarter, we released approximately 1,800 people with all the due care and compliance to all the laws of the land," he explained, adding that similar actions are expected in the upcoming quarter.
Industry-Wide Challenges and Global Influences
The hiring landscape in the IT sector has become increasingly complex, contrasting with the mass recruitment drives of previous years. Key challenges include uncertainty in deals from US-based clients, who constitute a significant portion of revenue for Indian IT firms. Policy shifts and tariffs under the Trump administration have prompted US clients to cut costs and delay IT services spending, impacting hiring decisions across the industry. This environment necessitates a careful balance between strategic hiring for growth and prudent workforce management in response to fluctuating demand.
Overall, while TCS's restructuring underscores a shift towards efficiency and technological adaptation, the continued hiring by peers like Infosys and Wipro reflects ongoing confidence in specific market segments and long-term growth prospects. The sector remains vigilant, navigating global economic uncertainties while investing in future talent and capabilities.
