Quick Take
- 78,000+ global tech workers were laid off in Q1 2026 — the highest single-quarter total since early 2024 — with nearly 48% of cuts explicitly attributed to AI automation.
- Mid-tier roles — QA, tier-1 support, coordination, legacy enterprise maintenance — are being structurally eliminated. AI-smart entry-level roles are being rebuilt in their place.
- India’s IT Big Four (TCS, Infosys, Wipro, HCLTech) are navigating the same shift: 82,000 freshers expected to be onboarded in FY26, but only those fluent in AI tools are seeing premium packages.
The IT hiring 2026 playbook has been torn up and rewritten simultaneously. Globally, technology companies cut over 78,000 workers in Q1 2026 — the largest quarterly total since early 2024 — with industry analysts attributing approximately 47.9% of those cuts directly to AI-driven automation rather than business contraction. The pattern is consistent: mid-tier roles built around coordination, legacy maintenance, and templated execution are being eliminated. AI-smart entry-level roles are being rebuilt in their place. The workforce pyramid is not collapsing. It is being reshaped from the middle.
In India, the same forces are arriving on a different timeline and at a different scale — but the direction is identical. India’s top IT services firms plan to onboard 82,000 freshers in FY26, signalling a recovery in entry-level demand. But the nature of that demand has fundamentally changed: companies are no longer hiring freshers to write boilerplate code and manage support queues. They are hiring freshers who can direct AI agents, evaluate model outputs, and translate automation into business outcomes.
StartupFeed Insight
The most important data point in this story is not the 78,000 global layoffs — it is Forrester’s finding that 55% of employers who conducted AI-attributed layoffs now regret them, and that half of those workers are expected to be quietly rehired offshore or at lower salaries. That pattern reveals the truth underneath the headline: most companies are not laying people off because AI has actually replaced their work. They are laying people off because AI gives executives a defensible narrative for the cost cuts they wanted to make anyway, while betting on AI productivity gains that, by Cognizant’s own Chief AI Officer’s admission, are still 6–12 months away from being real.
For Indian IT workers in the 3–8 year experience range — the so-called “mid-tier” — this creates a brutal near-term environment even if the long-term prognosis is better than the headlines suggest. The survival playbook is not complicated: develop a demonstrable AI skill, acquire a certification that is visible on a resume, and make yourself the person who makes the AI agent work, not the person the AI agent is replacing. NASSCOM’s own data says India needs 1.2 million AI professionals by 2027 and has only 420,000 today. That 3:1 gap is not a threat. It is the largest white-collar opportunity in Indian IT in a decade. — StartupFeed Desk
How IT Hiring 2026 Is Cutting Mid-Tier and Rebuilding Entry Level
The corporate restructuring template that has defined 2026 is now fully normalised across the technology sector. A company invests in AI tooling over 12–18 months. Leadership assesses which roles the tooling can partially or fully automate. Layoffs are announced — explicitly attributing the cuts to AI productivity — and paired with plans to hire in AI-adjacent roles. The company frames the move as competitive necessity. The stock typically rises.
| Company | Q1 2026 Action | Roles Cut | Roles Being Added |
|---|---|---|---|
| Oracle | ~20,000–30,000 layoffs (18% of global workforce); $156 Bn AI infra buildout | Legacy enterprise software maintenance, traditional DBA, support roles | AI infrastructure, cloud engineering, data centre operations |
| Meta | New layoff round from March 25; Reality Labs, recruiting, sales, global ops | Coordination, support, non-client functions | AI researchers, AI product engineers |
| Atlassian | 1,600 cut (10% of workforce); CTO replaced by two AI-focused co-CTOs | General engineering, project coordination | 800 AI-focused roles announced simultaneously |
| Block (Square, Cash App) | ~4,000 cut (10,000 → under 6,000); largest single AI-attributed workforce cut in corporate history | Operations, support, process roles | AI automation engineers, fintech AI product roles |
| IBM | Bucking the trend — tripled entry-level hiring in 2026 | Minimal cuts publicly announced | AI-literate freshers across engineering and services |
| TCS (India) | ~12,000 role reduction in July 2025; FY26 fresher intake continuing | Legacy application maintenance, manual QA, tier-1 support | AI, cloud, cybersecurity skill profiles |
| Infosys (India) | No layoffs announced; CEO affirms AI is expanding work, not contracting it | Generalist roles evolving toward specialisation | 20,000 freshers planned for FY26; reskilling emphasis |
Mid-level management has emerged as a particularly vulnerable category — a finding that cuts against the conventional assumption that junior roles face the highest automation risk. AI project management tools now automate sprint planning, resource allocation, status reporting, and dependency tracking, eliminating the coordination function that defined many mid-tier project manager and programme manager roles. Several companies in the 2026 wave have explicitly flattened management hierarchies as part of their restructuring. Atlassian’s decision to replace its single CTO with two AI-focused co-CTOs is the most symbolic expression of this trend: not fewer leaders, but differently-shaped leadership.
The India IT Picture: 82,000 Freshers, But Not the Old Kind
India’s IT Big Four — TCS, Infosys, HCLTech, and Wipro — collectively plan to onboard approximately 82,000 fresh graduates in FY26, a recovery signal after the muted hiring years of 2023–24. But the recovery is skill-conditional. Entry-level hiring at these firms has bifurcated sharply: mass campus intake at ₹3.5–6 LPA for generalist roles, and a premium off-campus track paying ₹6.25–21 LPA for AI-literate candidates who can demonstrate hands-on deployment of ML models, LLM APIs, or agentic AI systems.
The skills commanding the highest fresher salary premiums in India’s IT sector in 2026 are, in order: Python for AI and ML development, LangChain and LLM APIs for agentic AI, AWS and Azure certifications for cloud engineering, and SQL with Power BI for data analytics. A fresher who has trained real models and deployed them as APIs is being treated as a mid-level hire at many Indian companies — a structural salary arbitrage that did not exist three years ago.
What Roles Are Being Eliminated — and What Is Being Built?
| Role Category | Direction in 2026 | Reason |
|---|---|---|
| Manual QA / test engineers | Structural decline | AI-assisted testing tools (Cursor, GitHub Copilot) automate regression and functional testing |
| Tier-1 support / helpdesk | Structural decline | LLM-powered chatbots handle the majority of L1 queries without human intervention |
| Legacy database administrators | Structural decline | Oracle, SAP, and cloud platforms have automated DBA functions that required manual oversight |
| Mid-level project / programme managers | Contracting | AI project tools automate sprint planning, resource allocation, and status reporting |
| Generalised “software engineer” | Contracting but not eliminated | Companies doing same work with fewer, more AI-capable senior engineers |
| AI engineers / MLOps specialists | Strong growth | Demand for engineers who can build, deploy, and maintain AI systems — every company needs them |
| Prompt engineers / AI UX designers | Strong growth | New role category; designing effective human-AI interaction is a distinct skill |
| AI safety researchers | Strong growth | Regulatory pressure and enterprise risk management are driving institutional AI safety roles |
| Data infrastructure architects | Strong growth | AI systems require clean, governed data pipelines — this is the foundational infrastructure layer |
| AI-smart freshers (India-specific) | Strong growth — premium salary track | NASSCOM data: India needs 1.2M AI professionals by 2027; current supply is only 420,000 |
Is the AI Layoff Narrative Accurate — or Convenient?
The most contrarian data point in the 2026 hiring story comes from Forrester Research, whose Predictions 2026 report concluded that half of AI-attributed layoffs will be quietly rehired — offshore, or at significantly lower salaries. Forrester found that 55% of employers who conducted AI layoffs reported regretting them. Cognizant’s own Chief AI Officer, Babak Hodjat, was blunt in his assessment: some companies are using AI as a scapegoat for restructuring decisions driven by over-hiring during the zero-interest-rate years of 2020–22, not by actual AI productivity gains.
The cautionary data point is Klarna, which replaced 700 customer service employees with AI in 2024, watched quality decline, faced customer revolts, and was forced to rehire humans. The pattern — replace with AI, quality drops, quietly rehire — is the Forrester scenario made concrete. For workers in affected roles, the honest assessment is that the replacement cycle is painful regardless of whether the underlying AI productivity gains are real. For companies, the honest assessment is that cutting institutional knowledge now and rehiring offshore later is not an innovation strategy — it is a cost arbitrage dressed in AI vocabulary.
What Does Infosys’ Divergent Strategy Signal?
Infosys stands out as the most explicit counter-narrative to the 2026 IT layoff story. CEO Salil Parekh has said publicly that AI is expanding work at Infosys, not contracting it — and the company is maintaining its planned intake of 20,000 freshers in FY26, matching last year’s hiring level. Parekh noted that AI currently contributes approximately 5.5% of Infosys’ revenue and is growing, that the company is deepening partnerships with OpenAI and Anthropic, and that its internal Topaz Fabric platform is scaling AI-led development.
Infosys’ strategy is a deliberate bet that the long-run demand for human talent in an AI-augmented delivery model exceeds what cost-cutting layoffs can deliver in the short run. The company is also placing emphasis on deep specialisation over generalism — Parekh specifically noted increasing value on “deep individual knowledge and subject matter expertise,” suggesting Infosys sees the future of its workforce as a layer of highly specialised engineers directing AI agents, rather than a large layer of generalist engineers writing code manually.
What’s Next
Three signals to watch in the next two quarters. First, the Q4 FY26 results of India’s Big Four — particularly headcount disclosures and attrition data — will reveal whether the 82,000 fresher intake target is on track and whether mid-level attrition is accelerating or stabilising.
Second, NASSCOM’s India AI Skills Report update, expected mid-2026, will refresh the 1.2 million AI professional demand figure and reveal whether India’s training ecosystem is closing the gap.
Third, the Forrester “quiet rehire” prediction — watch whether any major company that conducted AI-attributed layoffs in Q1 2026 begins posting large-volume hiring in equivalent roles by Q3 2026. If Forrester is right, the evidence will be visible in job board data within six months. The IT workforce is being restructured in real time.The question for every professional in this sector is not whether the change is coming — it is whether they are positioned to be the person directing the AI, or the person the AI has directed out the door.
Frequently Asked Questions
How many IT jobs were cut in 2026 due to AI?
According to data from Layoffs.fyi and Nikkei Asia, over 78,000 tech sector workers were laid off globally in Q1 2026 — the largest quarterly total since early 2024. Industry analysts attribute approximately 47.9% of those cuts (roughly 37,600 positions) specifically to AI-driven automation, where the role was eliminated because an AI tool now performs the function, rather than because of business downturns. Globally, more than 150,000 tech and corporate roles have been eliminated since the start of 2026.
Are Indian IT freshers still getting hired in 2026?
Yes — India’s top IT firms (TCS, Infosys, HCLTech, Wipro) plan to onboard approximately 82,000 fresh graduates in FY26, signalling a recovery in entry-level demand after muted years. However, hiring is increasingly skills-conditional. Freshers with demonstrated AI, ML, LLM API, or cloud engineering skills are being hired on a premium off-campus track paying ₹6.25–21 LPA, while generalist mass campus intake continues at ₹3.5–6 LPA. NASSCOM data shows India needs 1.2 million AI professionals by 2027 — with current supply at only 420,000 — creating a significant premium for AI-literate freshers.
Which IT roles are most at risk from AI automation in 2026?
The roles facing the sharpest structural decline in 2026 are manual QA and test engineers, tier-1 support and helpdesk staff, legacy database administrators, and mid-level project and programme managers whose primary function involves coordination and reporting. Roles with the strongest growth trajectory are AI engineers, MLOps specialists, prompt engineers, AI safety researchers, data infrastructure architects, and AI-literate entry-level hires who can direct and evaluate AI agent outputs.
Written by Harshvardhan jain. Published: May 1, 2026. Updated: May 1, 2026. Have a tip? Write to us at editorial@startupfeed.in.
