<p>Bengaluru: India's largest IT services provider <a href="https://www.deccanherald.com/tags/tata-consultancy-services">Tata Consultancy Services</a> will reduce its workforce by 2 per cent in its 2026 financial year, primarily affecting middle and senior management, the company said on Sunday.</p><p>The company is retraining and redeploying staff as it enters new markets, invests in new technology and deploys AI, but about 12,200 jobs will be cut as part of the process, it said.</p><p>"This transition is being planned with due care to ensure there is no impact on service delivery to our clients," the company added.</p>.Market Cap Dip: Reliance, TCS among 6 top firms to lose Rs 2.22 lakh crore in bearish week.<p>India's $283 billion IT sector has had to contend with clients holding back non-essential technology spending because of weak demand, persistent inflation and lingering uncertainty over US trade policies.</p><p>TCS Chief Executive K Krithivasan said this month that there were delays in client decision-making and project starts. </p>.<p>Phil Fersht, CEO of IT advisory firm HFS Research, said that the impact of AI is eating into the people-heavy services model in the sector.</p><p>"(That model) is forcing large service providers such as TCS to rebalance their workforces to maintain profit margins and stay price-competitive in a cut-throat market where clients are demanding 20-30 per cent price reductions," Fersht said.</p><p>The decision by TCS, considering its culture of being a stable place to work, highlights this sectoral trend, he added.</p>
<p>Bengaluru: India's largest IT services provider <a href="https://www.deccanherald.com/tags/tata-consultancy-services">Tata Consultancy Services</a> will reduce its workforce by 2 per cent in its 2026 financial year, primarily affecting middle and senior management, the company said on Sunday.</p><p>The company is retraining and redeploying staff as it enters new markets, invests in new technology and deploys AI, but about 12,200 jobs will be cut as part of the process, it said.</p><p>"This transition is being planned with due care to ensure there is no impact on service delivery to our clients," the company added.</p>.Market Cap Dip: Reliance, TCS among 6 top firms to lose Rs 2.22 lakh crore in bearish week.<p>India's $283 billion IT sector has had to contend with clients holding back non-essential technology spending because of weak demand, persistent inflation and lingering uncertainty over US trade policies.</p><p>TCS Chief Executive K Krithivasan said this month that there were delays in client decision-making and project starts. </p>.<p>Phil Fersht, CEO of IT advisory firm HFS Research, said that the impact of AI is eating into the people-heavy services model in the sector.</p><p>"(That model) is forcing large service providers such as TCS to rebalance their workforces to maintain profit margins and stay price-competitive in a cut-throat market where clients are demanding 20-30 per cent price reductions," Fersht said.</p><p>The decision by TCS, considering its culture of being a stable place to work, highlights this sectoral trend, he added.</p>