NEW DELHI – Major corporations like Oracle and Tata Consultancy Services (TCS) are shedding tens of thousands of jobs for Indian IT workers as AI adoption and cost-cutting measures reshape the sector. Oracle was laying off an estimated 10,000 employees in India earlier in April, part of a wider international workforce reduction. TCS shed more than 23,400 jobs, with its employee headcount falling to 584,519 in the current financial year from 607,979 one year earlier. This systematic reduction of labor comes as companies invest heavily in artificial intelligence, data science, and cybersecurity infrastructure.
Ms. Tanya Gupta, a 39-year-old worker who had spent nearly five years handholding new customers for an American financial software firm in Dublin, Ireland, saw her annual contract not renewed in April 2026. The company cited increased investment in artificial intelligence as the reason. Ms. Gupta, who declined to use her real name to protect future employment prospects, stated that “a lot of the repetitive work is being automated, allowing employees to focus more on higher-value, strategic and creative work.”
The Indian IT sector, which accounted for around 7.2 million jobs in 2024, has seen close to 40,000 layoffs in the past year or so, according to data from TeamLease Digital. These job losses include many mid-level managerial roles, signaling a deep structural shift rather than a temporary downturn. Ms. Neeti Sharma, chief executive of TeamLease Digital, characterized this as “a structural – not cyclical – correction driven by AI-led productivity compression, slower global discretionary tech spending, and a pivot away from legacy services.”
Who Profits from Automation?
The drive to automate tasks directly translates into reduced labor costs and increased surplus extraction for corporations. Ms. Gupta observed that “if an engineer took two days to finish a task, the same thing can now be achieved by AI in less than 30 minutes.” This efficiency gain, she noted, logically led the company to conclude it “does not need the same workforce size as before.”
Mr. Ashish Singh, founder of HireMaven, explained that Indian IT services firms had engaged in a hiring spree after the pandemic ebbed, doubling or tripling salaries to retain and attract talent. However, as anticipated projects failed to materialize amidst global economic uncertainty, these large staff “bench strengths” became a “liability.” Simultaneously, AI began to make its impact felt, with basic coding work outsourced to AI repositories and autonomous or semi-autonomous tools. Mr. Singh stated that a firm needing 10 employees for coding and development now requires “just one person with the knowledge of AI to handle all that work,” rendering many junior employees and mid-level team managers redundant.
Oracle's mass layoffs were explicitly attributed to the firm’s “desire to cut costs and increase spending on data centre infrastructure to handle AI workloads.” This demonstrates how capital reallocates resources, displacing human labor to invest in new technologies that promise greater efficiency and profit margins, while the burden of displacement falls squarely on the working class.
The State's Role in Managing Crisis
The Indian state, through entities like the Ministry of Electronics and Information Technology and the NITI Aayog government think-tank, is responding to this structural shift with initiatives focused on “skilling” the workforce. An October 2025 report from NITI Aayog, issued about six months ago, warned that AI-driven automation could displace up to two million jobs in India’s tech services sector by 2031. However, the report simultaneously projected that strategic upskilling could swell the number of jobs by around four million in the next five years.
The Ministry of Electronics and Information Technology has reported training an estimated 168,000 individuals in various AI-related courses. The ministry is also establishing labs in Tier 2 and 3 cities across the country to provide foundational-level courses in AI and data-related fields. These efforts aim to bridge a projected demand-supply gap in AI talent, with Deloitte forecasting Indian AI talent demand to grow from around 600,000 to more than 1.25 million by one year away, 2027.
The Burden on Labor
Despite state-led initiatives, the immediate cost of adapting to this new economic reality falls on individual workers. Ms. Gupta, facing the end of her job contract in April 2026, invested approximately 200,000 rupees, or S$2,700, in a 12-week online AI-skilling course from MIT Professional Education. She emphasized the individual responsibility to “keep yourself upskilled to be relevant in the employment market.”
The conventional path of studying computer science for a software developer career is no longer sustainable, as entry-level coding jobs shrink. Ms. Gupta noted that the long-held aspiration of many to become software programmers and be deployed overseas for higher salaries, particularly in the US, has “petered out” due to increased restrictions on foreign workers. Ms. Sharma described this as “a reality check for Indian families,” urging parents and children to “understand the shift in skills and domains that is happening right now in India and pivot into streams other than computer science so that each one stands a better chance at securing employment.” This places the onus of adaptation and financial investment directly onto the working class, while corporations reap the benefits of increased productivity and reduced labor costs.