TCS Plans Major Campus Hiring Push for FY 2026 Amid Workforce Adjustments

2025-01-10

Tata Consultancy Services (TCS), one of the world’s leading IT services providers, has announced ambitious plans to ramp up campus hiring for fiscal year 2026. This move comes as part of the company’s broader strategy to invest in fresh talent and strengthen its workforce. The announcement was made during the release of TCS’s financial results for the quarter ending December 31, 2024, which also highlighted significant employee promotions, a slight reduction in headcount, and a focus on reducing dependency on US H-1B visas.

Key Highlights from TCS’s Q3 2024 Results

1. Employee Promotions: TCS promoted over 25,000 associates in Q3 2024, bringing the total promotions for the fiscal year to more than 110,000. This reflects the company’s commitment to employee growth and upskilling.
2. Campus Hiring Plans: TCS is gearing up to onboard a higher number of campus hires in FY 2026, signaling confidence in its long-term growth trajectory.
3. Workforce Reduction: Despite the promotions, TCS reported a net reduction of 5,370 employees in Q3, bringing its total workforce down to 607,354. This marks the first quarter of FY 2024-25 with a net decline in headcount.
4. Attrition Rate: The attrition rate rose slightly to 13% in Q3, up from 12.3% in the previous quarter. However, TCS remains optimistic about stabilizing attrition in the coming quarters.
5. H-1B Visa Strategy: TCS emphasized its reduced reliance on US H-1B visas, citing its global operating model and local hiring strategies. Over 50% of its US workforce is now locally hired.

TCS’s Focus on Employee Growth and Stability

Milind Lakkad, TCS Chief HR Officer, highlighted the company’s efforts to invest in employee well-being and upskilling. He expressed confidence in reducing attrition rates in the future, despite the slight uptick in Q3. Lakkad also reiterated TCS’s commitment to campus hiring, which remains a cornerstone of its talent acquisition strategy.

Reducing Dependency on H-1B Visas

TCS has been actively reducing its reliance on H-1B visas, a program that allows US companies to hire foreign workers for specialized roles. K Krithivasan, CEO and MD of TCS, noted that the company’s US operations now rely heavily on local talent, with more than 50% of its US workforce hired locally. This shift aligns with global trends and regulatory changes affecting the H-1B visa program.

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What Undercode Say:

TCS’s latest announcements reflect a strategic balancing act between workforce optimization and long-term growth. The company’s decision to promote over 25,000 employees in a single quarter underscores its commitment to retaining and nurturing talent. However, the net reduction in headcount raises questions about the broader challenges facing the IT industry, including automation, project delays, and economic uncertainties.

The slight increase in attrition to 13% is noteworthy but not alarming, especially given the competitive nature of the IT sector. TCS’s confidence in stabilizing attrition suggests that the company is leveraging its robust employee engagement and upskilling programs to retain talent.

The emphasis on campus hiring for FY 2026 is a positive signal for fresh graduates and the education sector. By investing in young talent, TCS is not only securing its future workforce but also contributing to skill development in the tech industry. This approach aligns with global trends where companies are increasingly focusing on early-career talent to drive innovation.

The reduced dependency on H-1B visas is a strategic move that positions TCS as a global player with a localized workforce. This shift is likely a response to stricter visa regulations and the growing demand for local talent in key markets like the US. By hiring locally, TCS is not only complying with regulatory changes but also enhancing its cultural and operational alignment with its clients.

However, the decline in headcount, even as promotions rise, indicates that TCS is optimizing its workforce to improve efficiency. This could involve leveraging automation, AI, and other technologies to reduce dependency on manual processes. While this may lead to short-term workforce adjustments, it positions TCS for long-term sustainability in a rapidly evolving industry.

In conclusion, TCS’s Q3 2024 results highlight a company in transition, balancing immediate challenges with long-term strategic goals. Its focus on employee growth, campus hiring, and localized workforce strategies reflects a forward-thinking approach that could set a benchmark for the IT industry. As TCS navigates these changes, its ability to adapt and innovate will be critical to maintaining its leadership position in the global tech landscape.