The Indian IT sector is currently experiencing a wave of silent layoffs, affecting over 20,000 employees between 2023 and 2024. Among those impacted is 31-year-old Aakash, who recalls receiving an email from Teradata, a cloud analytics and data platform company, asking him to join a virtual meeting with a manager and an HR executive.
The meeting lasted 15-20 minutes, during which Aakash was presented with two options: termination with a lower payout or voluntary resignation with a four-month salary package. Opting for resignation, Aakash has since struggled to find a new job, despite attending 20-25 interviews.
Similar experiences have been reported by other employees across various IT firms. Sriram, for instance, was placed on the bench for 25 days at Cognizant after a client decided not to renew their contract. Unable to find another project, he was eventually asked to resign, receiving three months’ salary as severance pay.
The All India IT & ITeS Employees’ Union (AIITEU) reports that around 20,000 tech employees lost their jobs in silent layoffs in 2023. However, the union believes the actual number is higher and underreported. Silent layoffs typically involve giving employees 30 days to find a new role within the company, failing which they are asked to resign. In 2024 alone, the Nascent Information Technology Employees Senate (NITES) noted that 2,000-3,000 professionals lost their jobs among the top Indian IT services companies.
The stigma of termination further complicates the situation. Harpreet Singh Saluja, president of NITES, pointed out that once an employee’s relieving letter marks them as “terminated,” finding a new job becomes significantly more challenging. Employees are often required to sign non-disclosure agreements (NDAs) to receive their full payout, according to Saubhik Bhattacharya, General Secretary of AIITEU.
The layoffs are occurring across companies of all sizes. For instance, Teradata laid off 35-40 employees from its Hyderabad campus at the end of last year, following a global reduction of 1,100 employees in 2022. State Street, after taking over Atos Syntel’s operations in India, let go of 400-500 employees in March 2024. Multiple sources indicate that layoffs have also occurred at Accenture, Cognizant, and Infosys, although Infosys and Atos Group have denied such actions.
Industry experts consider these layoffs among the highest since the 2007-2008 financial crisis. Yugal Joshi, leader of technology services research at Everest Group, attributes the trend to challenging macroeconomic conditions. With offshoring and pyramid rationalization maxed out, companies have turned to employee reduction as a lever to maintain or increase operating margins.
The modus operandi of these layoffs involves structured, staggered processes to avoid attracting attention. This trend was reflected in the combined headcount decline for the top five Indian IT services companies in FY24. Tata Consultancy Services (TCS), Infosys, HCLTech, Wipro, and Tech Mahindra collectively lost around 69,167 employees amidst an uncertain demand environment and deal delays.
The shift in operating models, where every technical person is expected to be a billable resource, is also contributing to the layoffs. Employees who fail to meet these expectations are often forced out, leading to a higher-than-usual rate of silent layoffs.
As the Indian IT sector navigates these turbulent times, the impact on employees and the broader industry continues to unfold.
