Cognizant eyes up to 15,000 job cuts, India likely to see biggest impact

The possible job cuts come at a time when many large IT firms are restructuring. Slower spending by clients, rising automation, and the growing use of AI are changing the way companies operate.

In Short

• Cognizant may cut 12,000 to 15,000 jobs globally, mostly in India
• Shift from traditional pyramid model to leaner workforce with digital tools
• Clients reluctant to fund fresher training, prompting workforce restructuring

Another round of job cuts could be on the way in the IT sector. Cognizant is reportedly considering a major workforce reduction, and a large number of employees in India may be affected.

POTENTIAL LAYOFFS UNDER PROJECT LEAP

IT services company Cognizant is said to be planning to reduce its workforce by around 12,000 to 15,000 employees globally. Most of these job cuts are expected to take place in India, according to sources cited by Moneycontrol.

On April 29, the Nasdaq-listed firm said it expects to incur between $230 million and $320 million in severance costs under its new initiative, called Project Leap. However, it did not share any official numbers on job losses.

Cognizant currently employs over 357,000 people worldwide, with more than 250,000 based in India.

WHY THE CUTS MAY HAPPEN

Industry experts say there is a clear shift in how IT services are being delivered. Companies are moving away from the traditional pyramid model, where a large number of junior employees support a smaller group of senior staff.

One executive said clients are no longer willing to fund training for freshers and are not comfortable with large, layered teams. This change is pushing companies to rethink their workforce structure.

The estimate of potential layoffs is based on rough calculations of salary and severance costs across different regions. In India, the average annual salary is assumed to be around Rs 15 lakh. With severance pay typically around six months’ salary, the cost per employee comes to about Rs 7.5 lakh. Based on this, a large part of the restructuring budget could impact around 12,000 to 13,000 employees in India alone, mentioned the report.

Sources said that these figures are only estimates and the final number could change depending on how the restructuring is carried out.

Meanwhile, Cognizant’s CEO, Ravi Kumar S, said the changes are part of a global programme that will affect different parts of the organisation.

He also pointed out that the company is moving towards a “broader and shorter pyramid” structure. This includes a mix of digital tools and human workers, reflecting a shift towards automation and AI-driven services.

WIDER TREND IN IT SECTOR

The possible job cuts come at a time when many large IT firms are restructuring. Slower spending by clients, rising automation, and the growing use of AI are changing the way companies operate.

As a result, firms are adjusting their workforce to stay efficient in a rapidly evolving industry.

- Ends