Indian IT firms continue to hire despite AI-led automation

Headcount of the top five Indian IT services companies grew at a slower pace during July-September period of FY26 compared to last year. With AI-led automation replacing human workers, the numbers have surprised the industry watchers quite a bit. Except Tata Consultancy Services (TCS), the employee headcount of other four companies have gone up. For instance, Infosys added 8,203 employees in Q2FY26, making its fifth consecutive quarter of headcount addition. The third largest HCLTech added 3,489 employees in the second quarter, while Wipro added 2,260 employees, and the headcount at Tech Mahindra went up by 4,197 staffers by the end of September quarter.

However, TCS’ headcount went down by 19,755 during the period. A combined addition of the top five IT services companies saw a drop of headcount by 1,606 during the September quarter. While aggregate numbers may look grim, barring TCS, the headcount of the other four IT firms has increased. So, the anticipation of mass layoffs happening in the Indian IT industry due to rising AI adoption seems like a far cry, at least for the moment. Even companies like HCLTech have started providing standalone AI revenue for the first time. This is encouraging news as it reflects Indian IT players are increasingly looking confident about leading the AI wave.

Not only overall headcount addition, but even fresher hiring also continues, albeit at a slower pace. Most companies have given numbers of freshers absorbed during the second quarter of FY26. For instance, Infosys has hired 12,000 freshers for the first half of the fiscal year 2026 and is on track to reach its 20,000 fresher hiring targets for the fiscal year. Similarly, HCLTech hired 5,196 freshers in Q2 and 7,180 in Q1 of the ongoing financial year. It means fresher hiring is going on though companies are cautious in their overall headcount addition plan.

Not only hiring but also the deal pipeline of top five companies indicates enterprises’ spending on technology continues. TCS reported a robust $10 billion order book, while Infosys’ large deal TCV (total contract value) stood at $3.1 billion with 67 per cent being net new. Total contract value (TCV) of new deals remained robust for HCLTech as the company reported a pipeline of $2.57 billion during the quarter. Deal bookings of Wipro also remained sound with total bookings at $4.68 billion for the September quarter. Out of this, large deal bookings were at $2.85 billion for Wipro. Such deal bookings show that Indian IT firms are expected to be back on the growth path once the economic uncertainty following Trump tariffs wanes.

Meanwhile, AI-led development will certainly replace many workers, but it seems Indian IT companies are able to shift their workers to other productive positions through upskilling. Of course, silent firing is happening across many companies with several employees being asked to go. However, this is not widespread. Interestingly, the emergence of GCC (global capability centres) as a credible alternative to IT services companies on the hiring front has eased the pressure quite a lot.

Analysts are of the opinion that though revenue growth forecast of top IT firms for FY26 remains tepid, it is likely to recover in the next financial year. Once uncertainty owing to Trump tariff settles down, the recovery will be swift. Another striking feature of Q2 earnings is that most companies are of the view that H1B visa restriction will not have much material impact on their operations or workflow. Indian IT firms’ resilience is at display as they navigate the uncertain times.