'Not AI, But Skill Mismatch': TCS To Cut 12,000 Jobs Amid Push For Future-Ready Workforce

In a major restructuring move, Tata Consultancy Services (TCS), India’s largest software services provider, will cut around 12,200 jobs — 2 per cent of its global workforce during FY26 (April 2025–March 2026).

The decision, aimed at making the company “future-ready and agile”, comes as rapid technological disruptions reshape the IT industry.

TCS CEO K Krithivasan in a conversation with Moneycontrol said, “We have been calling out new technologies, particularly AI and operating model changes. The ways of working are changing. We need to be future-ready and agile.”

He added, “Still, we find that there are roles where redeployment has not been effective. This will impact roughly 2 per cent of our global workforce, primarily at middle and senior levels. It has not been an easy decision and one of the toughest decisions I have had to take as CEO.”

The company clarified that the layoffs are not directly linked to AI eliminating jobs but rather to addressing skill mismatches.

“This is not because of AI but to address skills for the future. This is about feasibility in deployment not because we need less people,” Krithivasan said.

The decision comes weeks after TCS introduced a stricter bench policy, requiring employees to achieve at least 225 billable days annually and capping bench time at 35 days a year.

Impacted employees will receive severance pay, extended insurance, and outplacement support.

However, employees have alleged that those benched for more than two months are being pushed to resign, with severance tied to compliance.

Analysts note the cuts reflect a shift as AI adoption reduces demand for traditional IT roles like testing and shortens project lifecycles.

“It’s a difficult call we have to take to build a stronger TCS,” Krithivasan emphasised, stressing efforts to make the process as compassionate as possible.

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