New Delhi, April 25 : Headcount at India's top IT firms declined by over 7,000 in FY26, which highlighted a sharp reversal in hiring trends as companies turned cautious on workforce expansion amid an increasing focus on Artificial Intelligence (AI) and changing demand in the industry.

However, the combined headcount of major IT services providers -- Tata Consultancy Services, Infosys, HCLTech, Wipro and Tech Mahindra -- fell by 7,389 employees in FY26, compared to a net addition of 12,718 in FY25, according to many reports.

The decline was largely driven by a major workforce reduction at TCS, which announced layoffs of around 12,000 employees during the year, one of the biggest job cuts by an Indian corporate in recent times. This dragged overall hiring into negative territory, even as three of the five firms reported marginal net additions.

Meanwhile, management commentary across companies reflected a cautious stance on hiring with firms refraining from giving clear guidance for FY27 amid an uncertain demand environment and evolving AI-led business models.

At an industry level, hiring growth has also shown signs of levelling off.

According to NASSCOM, the technology sector added only about 2,000 more net jobs year-on-year in FY26, with total additions at around 1.35 lakh compared to 1.33 lakh in FY25.

Additionally, the overall workforce in Indiaâ??s technology sector rose to 59.5 lakh in FY26 from 58.2 lakh in the previous year, suggesting a 2.3 per cent increase.

Quarterly wise trends remained mixed. In Q4FY26, Infosys has reported a decline of 8,440 employees, while TCS added 2,356 employees. HCLTech and Wipro saw modest increases of 802 and 135 employees, respectively. While Tech Mahindraâ??s headcount dropped by about 1,993.

In addition, fresher hiring plans also indicated moderation.

TCS has said that it plans to hire around 25,000 freshers in FY27, lower than the 40,000-42,000 range seen in previous years.

Infosys is expected to maintain a similar hiring level of around 20,000 freshers, while other firms indicated they would take a call based on demand conditions during the year.

/IANS