TCS Layoffs Highlight India’s Employment Crisis in the Age of AI

Context:
Tata Consultancy Services (TCS) is planning to lay off nearly 12,000 employees—about 2% of its workforce—by 2025. The official reasons: AI-led disruptions and a growing mismatch between available skills and actual job requirements. This move has reignited the debate over India’s job crisis in the era of automation and artificial intelligence.

AI in India: Job Creator or Job Killer?

The Upside: AI as a Growth Engine

• Rise in AI Jobs in India: AI-related job postings have grown at a 21% annual rate since 2019 (Bain & Co.).
• Projected Job Creation: India’s AI sector is expected to generate 2.3 million new jobs by 2027.
• Salary Trends: AI job salaries are rising at 11% annually, driven by acute talent shortages.
• Demand for AI Skills: Roles in data science, machine learning, and natural language processing are seeing sustained growth.

The Downside: AI as a Job Disruptor

• Mass Layoffs in Tech: TCS is not alone. Several Indian IT giants are restructuring due to AI automation.
• Widespread Job Insecurity: According to MWTI, 74% of Indian workers fear AI will replace their jobs.
• AI Skill Gap: Only 15–20% of the workforce has the required competencies in AI, data analytics, or automation.
• AI Talent Deficit: By 2027, India could face a shortfall of 1.1 million qualified AI professionals.

Skills Crisis Spreads Across Sectors

• Graduate Employability in India: Only 42.6% of college graduates are considered job-ready; for AI/ML roles, it’s marginally better at 46.1%.
• Sectoral Impact: Key industries like automobiles, pharmaceuticals, semiconductors, and electric vehicles (EVs) face talent shortages.
• Growing Workforce Deficit: India may face a skill gap of 30–32 million by 2025, expanding to 49 million by 2027.
• Corporate Interventions: Some companies are focusing on blue-collar skilling programs to adapt to automation.
• Professional Readiness: 77% of Indian workers feel underprepared for jobs in emerging technologies.

Way Forward: Building a Future-Ready Workforce

• AI Skilling Initiatives: Launch nationwide, AI-focused skill development missions, backed by both public and private players.
• Curriculum Modernization: Align educational content with industry 4.0 and future tech skills, and foster deeper industry-academia collaboration.
• Internships & Apprenticeships: Scale up the PM Internship Scheme, targeting MSMEs and smaller cities to decentralize opportunity.
• Real-Time Job Market Data: Build a robust framework for labour market intelligence, with real-time, granular employment data to guide policy.

The TCS layoffs are just the tip of the iceberg. India stands at a turning point where AI and automation can either supercharge the economy or deepen unemployment. The real challenge isn’t job loss—it’s job mismatch. To close the AI talent gap, India must invest boldly in skilling for the future of work.