Posted by Mumbai: Tata Consultancy Services (TCS) to cut 12,000 jobs because of skill mismatch and not AI. TCS has announced its plans to cut 12,000 jobs, which is approximately 2 percent of the company’s global workforce, as part of a strategic restructuring aimed at preparing the future-ready workforce and technological shifts.
In an interview with Moneycontrol, TCS CEO K Krithivasan explained that the decision was driven not by automation or productivity gains from artificial intelligence (AI), but by a growing mismatch between available skills and the company’s evolving delivery models.
“This is not because of AI giving some 20 percent productivity gains,” Krithivasan told the news outlet. “We are not doing that. This is driven by where there is a skill mismatch, or where we think that we have not been able to deploy someone.”
The workforce realignment will primarily affect employees at the middle and senior levels, though some junior-level associates who have remained unassigned for long periods may also be impacted. The process will be carried out over the course of the current financial year (FY26).
Krithivasan explained that with clients increasingly shifting to product-aligned and agile operating models, TCS has had to respond with internal transformation. The company has made significant investments in training, reskilling, leadership development, and redeployment, but in some cases, it has not been feasible to find suitable roles for certain employees.
The CEO also emphasized that TCS continues to hire and invest in high-quality talent. “It is not because we need fewer people. We will continue to look for high-quality talent, acquiring and training talent. That continues to happen,” he said.
“This is definitely one of the tough decisions for me to take because for anyone and for me particularly, it is a very tough decision. This is not a question of demand. It is a question of we being future ready,” emphasized Krithivasan on future-ready workforce.
The Tata Group company TCS employs approximately 600,000 people worldwide. The announcement marks one of the largest workforce restructuring efforts in the company’s history, reflecting broader changes in the global IT services industry.