According to analysts, the move by Indian outsourcing behemoth Tata Consultancy Services to close more than 12,000 positions marks the beginning of a larger AI-driven trend that may result in the loss of almost half a million jobs from the $283 billion industry over the course of the next two to three years.
Although TCS attributed its decision to lay off 2% of its personnel to skill mismatches rather than AI-related productivity increases, analysts saw the biggest layoffs ever by India’s largest private employer as the start of something bigger in the labor-intensive industry. There would be about 12,200 middle and upper management positions at TCS eliminated.
This (the anxiety brought on by TCS layoffs) might reduce consumer desire for luxury shopping and travel, as well as postpone long-term investments like real estate, Vasu said. According to hiring agency Xpheno, TCS and its competitors Infosys, HCLTech, Tech Mahindra, Wipro, LTIMindtree, and Cognizant together employ over 430,000 employees with 13 to 25 years of expertise.
“They might look like the large, fatty middle layer right now,” Kamal Karanth, a co-founder of Xpheno, stated. When Reuters asked the IT companies for comment, none of them replied.
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