TCS's workforce shrinks by 30,000 in 2 quarters
What's the story
Tata Consultancy Services (TCS) has witnessed a major decline in its headcount over last two quarters. The majority of this decrease is due to exits unrelated to its restructuring program. In Q2, TCS "released" 6,000 employees and 1,800 in the December quarter. This brings the total restructuring-linked exits to 7,800 over these two quarters. TCS's headcount, however, fell by 30,000 in the same period. This means that 22,200 employees left for reasons other than those related to the restructuring process.
Reasons
Factors behind the shrinkage
These departures unrelated to the restructuring process include voluntary attrition, routine churn, and other non-restructuring factors. TCS Chief Human Resources Officer Sudeep Kunnumal confirmed this, saying they continue to hire top talent from both lateral markets and campuses.
Hiring trends
Headcount reduction due to hiring slowdown
EIIRTrend CEO Pareek Jain attributed the drop in TCS's headcount to a sharp slowdown in hiring. He said, "Attrition is largely unchanged, but hiring has slowed drastically, which is why the workforce is shrinking." TCS's attrition rate rose by 20 basis points sequentially to 13.5% in Q3, while continuing with its workforce restructuring process.
Comparison
HCLTech's workforce remains stable
Unlike TCS, HCLTech's headcount remained largely stable over the same period. The firm added 3,489 employees on a net basis in Q2 FY26 but reported a net reduction of 261 employees in Q3 FY26. This took its total workforce to 2,26,379 at the end of December quarter. The fall came despite onboarding 2,852 freshers in Q3, suggesting that changes were driven by attrition and selective rationalization rather than broad hiring slowdown.
Future plans
TCS's hiring targets and AI influence
At the beginning of the fiscal year, TCS had announced its plan to maintain campus hiring. The company planned to recruit around 42,000 freshers or "similar or little higher," in FY26 after onboarding 42,000 trainees in the previous year. Former CHRO Milind Lakkad also said artificial intelligence would influence hiring decisions as it is a new opportunity that would require fresh talent.