Indian IT sector and startups workforce are experiencing significant layoffs and job losses, especially within its prominent information technology (IT) sector and among startups, driven by a combination of rapid artificial intelligence (AI) adoption, changing business strategies, and global economic pressures.
Major Layoffs in the IT Sector
As per media reports, India’s IT industry has seen record job cuts this year, notably led by Tata Consultancy Services (TCS), which reduced its workforce by nearly 20,000 employees in 2025—the biggest layoff in its history. Other giants such as Wipro, Infosys, Tech Mahindra, and HCLTech have also announced thousands of job losses as firms undergo “organizational restructuring” to align with AI-led services and automation strategies. Many of these layoffs have targeted mid- and senior-level employees, with companies citing “skill and capability mismatch” and a push towards AI readiness as key reasons.
- TCS: ~20,000 jobs cut, dropping the workforce below 600,000 for the first time since 2022
- Wipro: 24,516 jobs removed for cost efficiency and productivity
- Tech Mahindra: 10,669 positions cut for portfolio rebalancing
- HCLTech: 8,080 roles shed due to divestitures and realignment
Startups and Other Sectors
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Indian startups have also been hit hard, with more than 5,600 jobs lost in the sector during the first nine months of 2025. These losses are attributed to operational restructurings, AI-driven automation, funding challenges, and regulatory changes. In total, up to 50,000 jobs across the tech industry could be on the line in 2025, with further losses possible as companies pursue silent or stealth layoffs.
Broader Economic Impact
The layoffs have contributed to rising urban unemployment, which climbed to 7.1% in June 2025, with youth unemployment among those aged 15–29 nearing 19%. These job losses reflect not only routine business cycles but also deeper strategic shifts as digital transformation, AI, and automation technologies change the nature of employment across sectors.
Sectors Less Affected
While the IT and startup sectors face turmoil, industries such as healthcare, renewable energy, e-commerce, logistics, financial services, and education remain resilient and even continue to grow their workforce. These sectors are seen as more future-proof amid current disruptions, driven by demographic trends, policy support, and ongoing demand.
Workforce Adaptation and Future Prospects
Industry analysts emphasize that these layoffs are not purely signs of economic distress but indicate a fundamental transition towards a more AI-ready workforce. Major employers and the government are focusing on reskilling initiatives and practical internship programs to address skill mismatches and provide new opportunities for those displaced by automation and digitalization.
Job losses in India in 2025 are rooted in the country’s accelerating digital transition, the disruptive wave of AI, and evolving global economic headwinds. While certain sectors struggle, others continue to remain robust, and efforts toward skilling and workforce adaptation are intensifying to meet the challenges of this pivotal year.
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