Thousands of IT professionals across India have found themselves jobless as the industry undergoes a sweeping transformation. The layoffs extend from homegrown powerhouses such as TCS, Infosys, and Wipro to global majors like Accenture, Oracle, and IBM. Companies claim these cuts are part of a broader effort to reshape their operations around AI, cloud computing, and product-centric models. However, analysts caution that deeper structural and economic factors are driving the trend.
In FY 2023–24, India’s IT and ITeS exports reached nearly USD 199 billion, contributing 25.6% to total exports worth USD 778.2 billion. For FY 2024–25, projections suggest a rise to USD 224 billion, or 27% of total exports valued at USD 824.9 billion—a clear sign that the sector remains a cornerstone of India’s economy despite growing turbulence.
TCS shed around 12,000 roles, or 2% of its workforce, citing “organizational restructuring to become future-ready and agile.” Infosys downsized by 25,994 employees in FY 2024 under “workforce optimization amid volatile demand.” Wipro followed suit, cutting 24,516 positions to enhance “cost efficiency and productivity.” Together, these moves mark one of the most significant talent shake-ups in India’s tech sector, reflecting the harsh realities of automation, evolving business models, and the relentless march of artificial intelligence.Are the job cuts due to efficiency increases?
A number of experts feel that the recent job cuts aren’t truly driven by AI-driven efficiency gains but by pressure from company boards to showcase tangible value from AI adoption. So far, that value remains elusive, prompting firms to trim workforces in a bid to signal progress and cost discipline amid uncertain transformation outcomes.
ROI pressures leading to layoffs?
“I recently attended a workshop hosted by IIM Bangalore on AI and its impact on jobs. The speakers from the academic community across the globe had a view that the current job cuts in the companies are not because of the efficiency gains due to AI, but it is due to the pressure from their boards to demonstrate value from the use of AI which at presence seems to be elusive,” says Shubhendu Dutta, CTO, NSE Data and Indices.
However, there are others who disagree.
“The firms now seem to be getting value – the recent survey from Wharton is making quite a few rounds,” says BFSI tech leader Abhay Johorey, Managing Director, Protiviti India, pointing to a large-scale tracking survey at Wharton on corporate ROI from generative AI. According to the survey, 75% already have a positive return on investment on AI. It also says that 46% of business leaders have started using AI themselves.
“Yes, there are different views on this topic. But the fact remains that the value realization from AI is not significant enough to justify the job cuts that are reported everyday. This is happening in anticipation of an efficiency gain,” contends Dutta.
How are companies deciding AI adoption?
The question is, how are companies deciding where to implement AI? Is it based on internal evaluation, external consultancy, strategic foresight—or simply the fear of missing out?” This trend highlights the uncertainty driving many organizations’ rush toward artificial intelligence adoption without clear direction or value.
“My question here is how are the companies deciding where to implement AI. Is it internal investigation, external assessment or simply the contemplation or even worse fomo effect?” asks Rajiv Sharma, Co-Founder & CEO, at Sysquark Technologies Pvt. Ltd and former CIO of Easypolicy Insurance.
Conclusion
AI-driven layoffs in the IT sector highlight a profound shift in how technology and talent intersect. While automation and machine learning promise efficiency, many companies appear to be reacting hastily—driven more by boardroom pressure and the fear of missing out than by well-defined strategies. As voices like Rajiv Sharma question whether AI deployment stems from genuine insight or hype, the challenge becomes clearer: organizations must balance innovation with human impact. Sustainable transformation requires foresight, not fear—aligning AI’s potential with purposeful implementation that empowers people instead of merely replacing them in the pursuit of short-term gains.
