IT Firms Cut Jobs in Q1

With three of the top five IT firms reporting a sequential decline in net hiring in the first quarter of FY26, alongside TCS’s large-scale layoff plan, hiring activity in India’s highly sought-after software services sector

slowed significantly. Wipro, HCL Technologies, and Tech Mahindra each reported a quarter-on-quarter decline in new hires.

Meanwhile, net hiring at Infosys stood at 210 employees for the quarter — just 0.06% of its total headcount of over 3 lakh (3,23,788).

TCS, India’s largest private sector employer, was an outlier with a net headcount addition of 5,090 employees during the June quarter. However, this gain was offset by the company's July 27 announcement that it would reduce its global workforce by around 2% (12,000 employees) over the

coming year as part of a broader transformation aimed at becoming a "Future-Ready" organisation.

Companies	Hiring change (QoQ)	CEO salaries in FY25
TCS	5,090	₹26.5 crore
Infosys	210	₹80.6 crore
Wipro	-114	₹53.6 crore
HCL Technologies	-269	₹94 crore
Tech Mahindra	-214	₹53.9 crore

However, industry veterans had a different take on the layoff scenario amid slowing growth.

Mohandas Pai, former head of HR at Infosys and chairman of Aarin Capital, told CNBC-TV18 on July 28 that the layoffs are a “normal event” tied to slowing global growth. He explained that when entry-level hiring slows, the organisational pyramid can flatten, leading to a surplus of middle- and senior-level employees.

Globally, tech layoffs have already crossed the halfway mark of last year’s total of 2,38,461 job cuts, according to tech job marketplace TrupUp. So far this year, 441 layoff announcements have affected 1,31,417 tech workers.

Intel announced the year’s largest job cut at 21,400 employees, followed by TCS’s planned reduction of 12,000 positions—the second largest globally.

R Chandrashekhar, former president of NASSCOM, acknowledged the widespread impact of AI across industries but noted that it is not the

immediate cause of the TCS layoffs. He pointed instead to growing client expectations for IT firms to “deliver a lot more with less,” leading to cost pressures and internal restructuring.

A June note by brokerage firm Emkay observed that lateral hiring in IT services is likely to remain subdued. A rebound in hiring, it said, will depend on a sustained recovery in global tech demand, more stable macroeconomic conditions, and a revival in discretionary tech spending—none of which are currently evident.

From April to June, the Indian IT sector saw a weak performance overall, with Infosys being the only large-cap firm to post sequential revenue growth in constant currency terms.

Separately, employee rights organisation Nascent Information Technology Employees Senate (NITES) has reportedly written to the Ministry of Labour and Employment, seeking government intervention.