TCS reportedly laid off 8,000 employees in FY2026. Less than a year later, its CEO announced a team of 8,900 engineers for one specific kind of work.
The pattern repeated across the industry. TCS, Infosys, Wipro, HCL Tech and Tech Mahindra ended the year with 7,389 fewer employees, even after counting new hires. Eleven days after TCS spoke, Infosys said it would add 6,000 forward engineers over the next few years. Wipro wanted 1,500. The new roles pay a base of 18 to 25 lakh a year, against the three to four lakh most Indian IT firms offer freshers. Senior engineers earn 50 to 85 lakh.
Why would the same firms fire at the bottom and pay seven times more at the top? The answer lies in how these companies make money. Infosys and TCS do not mainly sell software. They rent out engineers by the hour, a model called staff augmentation. In the presenter's example, the IT firm bills a US client $28 an hour for work that costs it $11. That $17 gap is the gross profit, multiplied across hundreds of thousands of engineers.
The model works like construction. The client's own IT team draws the plan, the contractor supplies the bricklayers, and the bricklayer never asks whether the design is right. Value comes from selling time, not judgment.
The workforce behind that model is a pyramid. The base has five parts: testing, boilerplate (the same form written 400 times with only name and address changed), maintenance, translation and documentation. Maintenance can mean reading 40,000 lines of code from 2011 to find one faulty line. Above sit team leads, unit leads and technical leads with four to eight years of experience. At the top are project and delivery managers with eight to 15.
The base work is repetitive, rule-bound and high in volume. That is the work AI does best. The presenter claimed AI already outperforms at least 90% of humans in software engineering.
Everything in the middle of this pyramid exists to manage the base of the pyramid.
A team lead exists because 12 people need coordinating. A project manager exists because 40 people need tracking. Shrink the base, and those jobs have nothing left to manage.
Who, then, defines the problem when no blueprint exists? That is the field engineer's job, and the presenter's example is demining. Russia's bombardment contaminated about 156,000 square kilometres of Ukraine with mines. Manual clearance at the old pace would take 757 years. Palantir's engineers sat inside the ministries and merged 100 datasets, covering 6 million buildings, 1 million road segments and 60,000 railway segments. In March 2024, officials said 80% of the land would return to use within 10 years.
The FBI shows the opposite case. Its 800-page requirements document produced 400 change requests in one year, and by 2005 the bureau cancelled a $170 million project. The presenter argued the engineers were not bad. The failure lay in how requirements were defined.
The revenue gap tells the rest. Infosys earns $61,350 per employee. Palantir earns roughly $1.3 million, about 20 times more.
For a young engineer, the stakes are concrete. The degree is now only an entry ticket. The presenter claimed only a few hundred trained field engineers exist in the entire country, and the role is still in its early stages in India. A few hundred jobs cannot absorb thousands of displaced workers.
This is not an ordinary layoff. It is a seismic shift in the Indian IT industry.
