Nearshore Americas

Another Wave of Layoffs Hits Indian IT Sector; Experts Blame GenAI

The accelerated development of generative AI (GenAI) is reshaping the labor panorama for India’s IT services sector.

Since the end of March 2024, some of India’s most promiment tech firms have reportedly laid off significant numbers of their employees.

The top three tech services providers in the country have collectively terminated around 64,000 workers, according to local media reports. Wipro accounts for aproximately 25,000 job cuts, while the rest can be attributed to Infosys and TCS.

Several experts told The Times of India that the rapid advancement of generative AI might have played a role in the layoffs. IT firms are leveraging large language models for software testing and application coding, a trend believed to contribute to the displacement of human roles.

None of the companies have explicitly disclosed workforce reduction plans attributed to AI adoption in their recent quarterly reports.

Sign up for our Nearshore Americas newsletter:

Approximately a year ago, Satish HC, a senior executive from Infosys, cautioned that AI adoption in the tech sector would inevitably lead to job cuts. AI will augment the existing workforce, he explained, allowing companies to deliver service with a smaller headcount.

Not all experts are convinced that AI is solely to blame for the job losses. Some argue that the hiring surge following the COVID-19 pandemic boom led to an overstaffed workforce, prompting companies to realign their operations by laying off surplus employees.

Narayan Ammachchi

News Editor for Nearshore Americas, Narayan Ammachchi is a career journalist with a decade of experience in politics and international business. He works out of his base in the Indian Silicon City of Bangalore.

Add comment