From TCS to TechM, Headcount Declines Echo Vembu’s IT Hiring Concerns

Sridhar Vembu, Zoho co-founder has said India’s IT industry is no longer creating jobs as earlier. He said one reason for weaker hiring is the rising cost of AI and data centre infrastructure. Well this has been highlighted in India’s $250‑billion IT services sector which witnessed a historic shift in its employment engine, with companies such as TCS, Infosys to HCLTech, Wipro, and Tech Mahindra reporting mixed headcount trends in FY26 and the opening quarter of FY27. 

Tata Consultancy Services (TCS)

IT behemoth Tata Consultancy Services (TCS) reported a net reduction of over 23,000 employees in FY26, as the IT major recalibrated its workforce amid layoffs and softer demand, ending the year with a total headcount of 584,519.  In FY25, its total employee headcount stood at 607,979.

During the June quarter (Q1FY27) it added 9,279 employees on a net basis taking its total workforce to 593, according to the company’s quarterly fact sheet. The LTM attrition (IT Services) stood at 13.6 per cent.

The restructuring comes amid huge investments in AI. K Krithivasan, CEO, TCS, said “Q1 FY27 reflects continued growth momentum. We delivered a strong order book of $9.5 billion, including a marquee AI-led transformation deal with SKF, while continuing to add clients across key revenue bands and scaling our AI business to a $2.6 billion annualized revenue run rate.”

As of March 31, 2026, more than 270,000 associates possess higher -order AI/ML skills, supported by 69 million learning hours and 186,000 external certifications, TCS said in its annual report.

Infosys

The nature of work is changing materially; emphasis moves from code creation toward orchestration, system supervision, domain interpretation, and outcome validation. This necessitates new roles, large-scale reskilling, and a recalibration of workforce, Infosys highlighted in its annual report of FY26.

Infosys total headcount at the end of fiscal year 2026 (March 31, 2026) was 328,594 employees, representing a net increase of 5,016 employees from the previous fiscal year. However, the company saw its headcount decline by 532 in the first quarter of FY27. 

Attrition for the quarter grew to 13 percent from the previous quarter’s 12.6 percent on a last-twelve-month basis.

Jayesh Sanghrajka, CFO, Infosys said “We are accelerating investments in AI, talent, and platforms to drive future growth and remain committed to improving productivity, expanding operating leverage and maintaining the financial flexibility needed to capitalize on emerging opportunities while delivering sustainable shareholder value.”

Wipro

IT services major Wipro reported an increase in its workforce during the April-June quarter (Q1 FY27), taking its total employee count to 243,044 at the end of the quarter. The company added 888 employees during the quarter compared with 242,156 employees at the end of the March quarter (Q4 FY26), translating into a 0.37 per cent sequential increase in headcount. On a year-on-year basis, Wipro’s workforce expanded by 9,812 employees from 233,232 in the corresponding quarter last year, registering a 4.21 per cent increase.

Its IT Services Results of Operations for the years ended March 31, 2026 and 2025 said that the gross profit as a percentage of revenue from the IT Services segment decreased by 92 bps. This decline was primarily driven by an increase in employee compensation by INR 23,552 million due to the impact of salary increases, including promotions, and an increase in average headcount, including through acquisitions completed in fiscal year 2026 as compared to fiscal year 2025. 

HCLTech

HCLTech reported a decline in its workforce during the June quarter of FY27 (Q1FY27). The company reported a net reduction of 3,292 employees during the quarter, taking its total employee base to 223,889 at the end of Q1FY27, according to its earnings release.

The sequential decline follows a net addition of 802 employees in Q4FY26, when HCLTech’s workforce had risen to 227,181.Earlier, the company had reported a net reduction of 261 employees in Q3FY26.

The headcount movement comes as IT services companies continue to align hiring with demand amid macroeconomic uncertainty, slower discretionary spending, and increasing focus on improving productivity through AI. “We also remain focused on upskilling our people in emerging technologies and are embedding AI across the organization,” the company said in the release.

Tech Mahindra

Tech Mahindra reported a total workforce of 146,760 employees for the first quarter ended June 30, 2026 (Q1 FY27), marking a sequential decline of 863 employees compared to the preceding quarter. The company is currently executing a comprehensive business restructuring initiative under its new leadership team, with the objective of driving improvements in operating margins.

Mohit Joshi, CEO and MD of Tech Mahindra, noted, “Campus recruitment has been somewhat volatile, largely due to limited visibility on revenue flows. With visibility now improving, I anticipate that the campus hiring program will resume. However, at this stage, we do not have specific figures to share regarding the annual intake we expect to undertake.”

While some, like Wipro, managed modest sequential additions, others saw steep reductions as companies recalibrated hiring in the face of macroeconomic uncertainty, rising AI and data‑centre costs, and a fundamental redefinition of tech work itself. The restructuring wave, underscored by TCS’s $9.5‑billion AI‑led order book, Infosys’s pivot to orchestration and supervision roles, and Tech Mahindra’s cautious restart of campus hiring, signals an industry balancing aggressive investments in artificial intelligence with workforce rationalization, reskilling, and margin discipline.