New Delhi, India, August 16, 2025 — India’s job market is reeling as a wave of layoffs sweeps through the tech sector and beyond in August 2025, threatening the livelihoods of thousands. From IT giants like TCS to AI startups like Krutrim, companies are slashing jobs to navigate economic headwinds, automation, and global market pressures. With over 700,000 job cuts reported globally this year, India’s once-booming tech industry is at a crossroads. This SEO-optimized article dives into the latest layoffs across India, their causes, and the ripple effects on workers and communities. Stay updated with MasalaMirror for the latest on India’s job market and economic trends.

This Week’s Layoff Highlights in India

The week of August 10-16, 2025, brought significant layoff announcements, particularly in India’s tech hub cities like Bengaluru, Hyderabad, and Chennai. While exact numbers for this week are still emerging, posts on X and industry reports point to a turbulent period. Key layoffs include:

• Krutrim: The Bengaluru-based AI startup cut 100 jobs in its linguistics team, citing a shift toward generative AI technologies. This reflects a broader trend of AI-driven workforce reductions.
• Tata Consultancy Services (TCS): Reports on X claim TCS is laying off 12,000+ employees, though the company has not officially confirmed this figure. The cuts are part of a restructuring to streamline operations amid global economic slowdown.
• Chennai Corporation: Approximately 2,000 contract workers under the National Urban Livelihoods Mission (NULM) were let go due to outsourcing to private firms. These workers, many with 15 years of service, have been protesting for reinstatement.

These layoffs add to India’s growing tally of job cuts in 2025, with the tech sector alone seeing thousands of roles eliminated. Other industries, including textiles and manufacturing, are also affected, particularly in labor-intensive towns like Tiruppur and Surat.

Why Are Layoffs Surging in India?

India’s layoffs in August 2025 stem from a mix of global and domestic pressures reshaping the job market. Here are the key drivers:

1. AI and Automation: The rapid adoption of generative AI is displacing roles in software development, customer support, and data processing. Krutrim’s cuts reflect this shift, with AI replacing linguistics and content roles. A post on X notes that 49% of July global layoffs were tied to AI and “tech updates,” a trend hitting India hard.
2. Global Economic Slowdown: The U.S. tariff policies, including the end of a 90-day tariff pause on China (August 12, 2025), are raising costs for Indian exporters and IT firms with global clients. Economist Daniel Alpert warns that tariffs could trigger a recession, impacting India’s IT and manufacturing sectors.
3. Corporate Restructuring: IT giants like TCS and Infosys are streamlining to stay competitive. While TCS is reportedly cutting jobs, Infosys and Capgemini are hiring 20,000 and 45,000 freshers, respectively, showing a split in strategy—cutting mid-level roles while investing in new talent.
4. Outsourcing and Cost-Cutting: Public sector outsourcing, as seen in Chennai Corporation’s move to private firms, is displacing long-term contract workers. This reflects a broader push for cost efficiency in both public and private sectors.
5. Textile and MSME Crisis: Over 60,000 MSMEs in textiles and manufacturing are at risk, exposing 10-15 lakh jobs in towns like Tiruppur, Surat, and Ludhiana. Layoffs in these sectors are driven by declining demand and rising input costs.

The Human and Economic Impact

The layoffs are hitting India’s workforce hard, particularly in tech hubs and labor towns. In Bengaluru, Krutrim’s cuts have sparked outrage, with workers on X calling the lack of severance “unethical”. Chennai’s 2,000 NULM workers, many women from marginalized communities, face financial ruin after years of service, with protests ongoing outside the corporation office.

In textile hubs like Tiruppur, the closure of MSMEs threatens entire communities. A post on X warned that “labour towns could collapse” without government intervention, highlighting the lack of public acknowledgment from ministers. These layoffs risk creating economic voids in regions dependent on single industries.

India’s tech sector, once a global powerhouse, is facing a reckoning. With tech hiring down 58% and only 5,500 new roles announced in 2025, per @thejobchick on X, mid-level engineers and support staff are struggling to find opportunities. The shift toward AI and automation is creating a skills gap, leaving many workers unprepared for emerging roles.

Broader Context: India’s Job Market in Crisis

India’s job market is under strain. The Centre for Monitoring Indian Economy (CMIE) reported unemployment rising to 8.1% in urban areas in Q2 2025, with tech and manufacturing hit hardest. The global tech layoff wave—over 96,861 jobs cut across 413 companies in 2025, per TrueUp—has spilled into India, with firms like Microsoft, Intel, and TCS aligning with global cost-cutting trends.

The contrast between layoffs and hiring is stark. While TCS cuts jobs, Infosys and Capgemini are hiring freshers, signaling a focus on cost-effective talent over experienced staff. This split is creating a polarized job market, where fresh graduates have opportunities, but mid-career professionals face uncertainty.

What’s Next for Indian Workers?

For displaced workers, the path forward is challenging. The WARN Act equivalent in India, the Industrial Disputes Act, requires notice for layoffs in certain sectors, but enforcement is inconsistent. Workers can monitor platforms like Layoffs.fyi for updates on tech cuts, though India-specific data is limited.

Upskilling in AI, cloud computing, or cybersecurity is critical. The World Economic Forum predicts 41% of companies will cut jobs due to AI over the next five years, but new roles in these fields are emerging. Government initiatives like Skill India could help, but critics argue they’re underfunded and slow to adapt.

In textiles and MSMEs, workers face bleaker prospects. Without urgent government support, towns like Surat and Ludhiana risk economic collapse. On X, @SangwanHQ called for ministerial action, but silence from policymakers has fueled frustration.

A Call to Action

The August 2025 layoffs in India underscore a critical juncture for the nation’s economy. Tech workers must pivot to high-demand skills, while MSME employees need government intervention to stabilize their industries. Companies must balance innovation with ethical layoffs, offering severance and retraining support. As @divyaporwal_ urged on X, “Government should implement rules to stop unethical layoffs”.

For now, India’s job market is a battleground of opportunity and loss. Whether it’s Krutrim’s AI-driven cuts or Chennai’s outsourcing woes, the human toll is undeniable. Stay vigilant, upskill, and advocate for change to navigate this turbulent time.

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