The potential layoffs come as many major IT companies undergo restructuring, driven by reduced client spending, increased automation, and the expanding role of AI in operations.
Another wave of layoffs may be looming in the IT sector, with Cognizant reportedly planning a significant workforce reduction that could heavily impact employees in India.
Possible Job Cuts Under Project Leap
Cognizant is reportedly planning to cut around 12,000 to 15,000 jobs globally, with most of the layoffs expected to impact its India workforce, according to sources cited by Moneycontrol.
On April 29, the Nasdaq-listed Cognizant said it expects to incur $230 million to $320 million in severance costs under its new initiative, Project Leap, but did not disclose any official figures on job cuts.
Cognizant employs over 357,000 people globally, with more than 250,000 of them based in India.
Why the IT Sector May See More Layoffs
Industry experts note a clear shift in how IT services are delivered, with companies moving away from the traditional pyramid model that relies on a large base of junior employees supporting a smaller group of senior staff.
One executive said clients are no longer willing to pay for training freshers and are increasingly uncomfortable with large, layered teams, prompting companies to rethink their workforce structure.
The estimated layoffs are based on rough calculations of salaries and severance costs across regions. In India, with an average annual salary of about ₹15 lakh and severance typically at six months’ pay (around ₹7.5 lakh per employee), the report suggests that a significant portion of the restructuring budget could affect roughly 12,000 to 13,000 employees in the country.
Sources noted that these figures are only estimates, and the final number may vary depending on how the restructuring unfolds.
Meanwhile, Cognizant CEO Ravi Kumar S said the changes are part of a global programme that will impact various parts of the organisation.
He added that the company is transitioning to a “broader and shorter pyramid” structure, combining digital tools with human talent—reflecting a shift toward automation and AI-driven services.
Broader Trend Across the IT Sector
The potential job cuts come amid widespread restructuring across major IT firms, as slower client spending, increasing automation, and the growing use of AI reshape business operations.
As a result, companies are recalibrating their workforce to remain efficient in a rapidly evolving industry.