Tata Consultancy Services (TCS), India’s largest IT services company, has announced plans to lay off approximately 12,000 employees, or 2% of its global workforce of 613,069, by March 2026. This significant workforce reduction, primarily targeting mid-level and senior-level staff, is driven by a combination of skill mismatches, macroeconomic uncertainties, and the rapid adoption of artificial intelligence (AI). For Non-Resident Indians (NRIs) working at TCS or in the broader IT sector, these layoffs signal a challenging period, particularly for those in global hubs like the U.S., U.K., and Canada. The challenges are compounded by recent U.S. policy shifts, as President Donald Trump has urged tech giants like Google and Microsoft to halt hiring in India and prioritize American workers, as reported by NRI News Club. This article explores the implications of TCS’s layoffs and U.S. policy changes for NRIs, integrating insights from industry trends, including Microsoft’s layoffs of 15,000 employees, to provide a comprehensive view of the evolving tech landscape for NRIs.
Why Is TCS Laying Off 12,000 Employees?
TCS’s CEO, K. Krithivasan, has emphasized that the layoffs are not solely due to AI-driven productivity gains but are part of a broader strategy to create a “future-ready organization.” The company is realigning its workforce to address skill mismatches, with a focus on roles where redeployment is not feasible. Key factors contributing to the layoffs include:
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AI and Automation: AI is reshaping roles in software development, testing, and infrastructure management, reducing demand for traditional skills. Industry estimates suggest AI could yield 20-30% productivity gains, prompting companies to streamline operations.
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Macroeconomic Challenges: Global economic uncertainties, including U.S. tariffs under President Donald Trump, have led to reduced IT spending by U.S. clients, a critical market for TCS. Clients are delaying major projects or extending existing contracts, impacting revenue growth.
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Bench Policy Changes: TCS’s stricter bench policy, effective June 12, 2025, limits unallocated time to 35 days annually, with mandatory upskilling and office attendance. Employees exceeding this limit face termination, disproportionately affecting mid- and senior-level staff.
As of June 2025, TCS employed 613,069 people worldwide, with a recent addition of 5,000 employees in the April-June quarter. However, the layoffs, which began in early July, have already impacted employees in Bengaluru, London, and Princeton, with reports of hundreds being asked to leave.
Industry Context: Microsoft’s Layoffs and AI Pivot
The TCS layoffs are part of a broader wave of tech industry restructuring, as evidenced by Microsoft’s recent layoffs of over 15,000 employees, including 9,000 in early July 2025, as reported by NRI News Club. Microsoft CEO Satya Nadella, in a memo titled “Recommitting to our why, what, and how” acknowledged the emotional toll of these cuts, stating, “These decisions are among the most difficult we have to make. They affect people we’ve worked alongside, learned from, and shared countless moments with—our colleagues, teammates, and friends.” The layoffs, primarily affecting sales and gaming divisions like Xbox and King, aim to create flatter, more agile teams, with about 2,290 employees in Redmond, Washington, and others globally impacted.
Microsoft’s layoffs, represent nearly 4% of its 228,000-strong workforce as of June 2024. The cuts target sales teams (45,000 employees) and gaming units, including King’s Barcelona office, which is losing 10% of its staff. Microsoft’s focus on AI, with an $80 billion investment in AI infrastructure and the $4 billion “Elevate” initiative to train millions in AI skills, mirrors TCS’s shift toward AI-driven efficiency. Nadella emphasized empowerment through AI, stating, “It’s about building tools that empower everyone to create their own tools.” highlighting a reimagined tech stack focused on security, quality, and AI transformation.
U.S. Policy Shifts: Trump’s Call to Halt Hiring in India
Adding to the challenges, President Donald Trump has urged U.S. tech giants like Google, Microsoft, Meta, and Amazon to stop hiring workers from India and focus on American jobs, as reported by NRI News Club. Speaking at an AI Summit in Washington on July 23, 2025, Trump criticized these companies for “reaping the blessings of American freedom while building factories in China, hiring workers in India, and stashing profits in Ireland,” declaring, “Under President Trump, those days are over.” He signed three executive orders to boost domestic AI development, including accelerating infrastructure, ensuring political neutrality in federally funded AI, and promoting American-made AI exports. These policies signal a shift toward tech nationalism, raising concerns for NRIs about reduced job opportunities and increased competition in the U.S. tech sector.
Impact on NRIs in the Tech Sector
For NRIs, particularly those on H-1B visas in the U.S. or similar work permits in other countries, the TCS and Microsoft layoffs carry significant implications:
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Job Security Concerns: NRIs in mid-level and senior-level roles at TCS and Microsoft, especially those with 10+ years of experience, are at higher risk. Microsoft’s simultaneous filing for 6,327 H-1B visas for software engineers, despite layoffs, raises concerns about job replacement, as noted in X posts. At TCS, the focus on upskilling in AI and emerging technologies means NRIs must adapt quickly to remain competitive.
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Visa and Immigration Challenges: Layoffs and reduced hiring could jeopardize visa statuses for NRIs, particularly in the U.S., where H-1B visa scrutiny is increasing, alongside a new $250 Visa Integrity Fee set to take effect in 2026. Microsoft’s H-1B holders face a 60-day grace period to find new employment, a challenge compounded by Trump’s push to prioritize American hiring, which may lead to stricter visa policies.
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Economic Ripple Effects: The layoffs and hiring restrictions reflect broader challenges in India’s IT sector, which generates over $283 billion in revenue, and in global tech hubs. For NRIs sending remittances to India, job losses and reduced hiring could reduce financial contributions, impacting families and local economies in cities like Bengaluru and Hyderabad. However, the U.S. Senate’s “One Big Beautiful Bill Act,” reducing remittance tax to 1% from 3.5%, offers some financial relief for NRIs. Read the full story on Big Remittance Break here.
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Career Transitions: Both companies are offering severance packages, extended insurance, and outplacement support, but NRIs may face difficulties finding equivalent roles in a competitive global market. Microsoft’s tools like GitHub Copilot (15 million users) and TCS’s AI-driven projects highlight the need for skills in machine learning and data analytics.
What Can NRIs Do to Navigate These Changes?
To stay resilient in this evolving landscape, NRIs can take proactive steps:
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Upskill in AI and Emerging Technologies: Enroll in AI-focused courses, such as those offered by Coursera or Udemy, to gain skills in machine learning, cloud computing, and automation. Industry body Nasscom estimates India needs 1 million AI professionals by 2026, while Microsoft’s “Elevate” initiative underscores global demand for AI expertise.
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Leverage Networking Opportunities: Engage with professional networks on LinkedIn and attend industry events to explore opportunities in AI-driven startups or companies expanding in India, such as IBM, which is shifting hiring to India. Also, read about Costco’s India Entry as reported by NRI News Club.
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Explore Alternative Markets: Consider opportunities in GIFT City or other Indian financial hubs, which are attracting NRI investments and tech talent. Real estate and tech roles in cities like Bangalore and Hyderabad remain viable options.
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Stay Informed on Visa Policies: Monitor changes in U.S. immigration policies, including H-1B reforms and tariff impacts, to plan for visa renewals or transitions to other countries like Canada or the U.K. Organizations like Indian American Community Services can provide visa-related guidance.
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Financial Planning: Given the uncertainty, NRIs should diversify income sources and consult financial advisors to manage remittances and investments in India, especially in light of new tax demands and compliance requirements.
Broader Industry Trends
TCS and Microsoft’s layoffs are part of a larger wave of workforce reductions in the global tech sector, with over 80,000 tech jobs cut across 169 companies in 2025, including 15,000 at Microsoft and 9,000 at IBM. Indian IT firms like Infosys, Wipro, and HCLTech are also implementing hiring freezes and cost-cutting measures. The focus on AI and automation, combined with U.S. tariff policies, is creating a “ruthless recalibration” in the industry, challenging the perception of IT as a stable career path for NRIs. Social media reactions highlight the anxiety, with one X user noting, “TCS laying off 12,000 employees means job loss due to AI automation is real. Competition will increase, and pay will decrease” while another expressed concern about Microsoft’s cuts, stating, “If Microsoft and TCS are laying off, what will be the situation in other IT firms? Looks horrible.”
Conclusion
The TCS layoffs, alongside Microsoft’s reduction of 15,000 jobs, underscore the transformative impact of AI and global economic shifts on the IT sector, posing unique challenges for NRIs. While both companies are offering severance and support, NRIs must prioritize upskilling, networking, and strategic planning to secure their careers. As India’s IT industry and global tech hubs evolve, NRIs can leverage their global experience to explore new opportunities, both abroad and in India’s growing tech hubs. For more insights on navigating the tech landscape, stay connected with our NRI News Club Whatsapp Channel and Reddit Community for related stories on Microsoft’s layoffs and NRI career strategies.
