Unbilled Employees, Freshers, and Lateral Hires Face Growing Uncertainty Amid AI-Led Restructuring

Bengaluru, July 29, 2025 Tata Consultancy Services (TCS), India’s largest IT services firm, has reportedly laid off over 12,000 employees in recent weeks. This move has raised fresh concerns about widespread layoffs across the Indian tech sector. The company is targeting staff who have been on the “bench” for extended periods—typically between 3 to 18 months. Artificial intelligence (AI), automation, and global demand uncertainty are driving the restructuring.

Sources revealed that TCS is laying off mid and senior-level staff who remain “unbilled” despite having relevant experience. The move has unsettled IT professionals and talent markets. Traditionally, benching was seen as a buffer during project gaps, not a liability. However, shifting business models and rising margin pressures have changed that view. Companies now seem to prefer leaner, high-skill teams aligned with AI-focused strategies.

Several employees, speaking to TOI on condition of anonymity, reported sudden terminations without prior notice. They also said HR offered no information about redeployment options. One such employee said, “There was no prior intimation. I was just asked to resign.”

Moreover, industry experts say Indian IT firms are increasingly mirroring global trends, as the sector struggles with slower growth, shrinking client budgets, and urgent transformation needs. The push to deliver value over volume has forced firms to re-evaluate traditional hiring models. As a result, large-scale hiring is giving way to targeted recruitment for roles requiring niche skills like generative AI, cybersecurity, and cloud architecture.

A senior executive explained, “AI is not just a buzzword anymore. It is actively disrupting workforce planning. Clients want faster, more efficient solutions. Companies are adapting by hiring fewer but sharper-skilled resources.”

In addition to experienced professionals, fresh graduates and lateral hires are also facing uncertainty. Several freshers, particularly from tier-2 and tier-3 institutions, have not received joining dates months after receiving offer letters. TCS’s onboarding delays and communication blackouts have fueled anxiety across campuses.

Meanwhile, lateral hires are struggling with onboarding freezes, even after clearing interviews and background checks. Moreover, this shift in recruitment strategy means that many roles once considered entry points into the IT industry are now being redefined—or in some cases, rendered obsolete.

In response, education experts are urging immediate curriculum reform to close the widening gap between industry expectations and graduate skill levels. “If we fail to integrate AI and data competencies across disciplines now, we risk a large-scale mismatch in the job market,” cautioned a senior academic from a top engineering institute.

The situation is not unique to TCS. Industry-wide, companies are consolidating teams, scrapping unviable roles, and revisiting employee deployment strategies. Although the IT sector holds long-term promise, the current shake-up marks a difficult yet essential move toward a leaner, innovation-led model.

As a key global IT hub, India may see the TCS shake-up set a precedent for how other tech giants adapt to the post-AI world.

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