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Indian IT firms cut more US jobs as AI expands: analysts
Indian IT and BPO firms may have cut more US jobs in Q1 2026 than in all of 2025.
Analysts said slower deal-making, client pressure to cut costs, and wider AI use are making it harder to redeploy onsite staff tied to large outsourcing contracts.
Under the Worker Adjustment and Retraining Notification Act (WARN), companies with more than 100 employees must give 60 days’ notice before conducting large layoffs affecting over 50 workers or shutting down a plant.
Florida, Texas, and Pennsylvania received notices from Hinduja Global Services, Infosys, and HCL Technologies between January and March.
Genpact was the only Indian heritage services firm to file one in 2025, while four notices were filed in 2024.
Some notices, however, reflect worker transfers rather than direct layoffs, such as Infosys BPM’s February filing covering 248 employees linked to a reworked Vanguard deal.
🔗 Source: The Economic Times
🧠 Food for thought
Implications, context, and why it matters.
The Vanguard deal marks a reverse transition, with workers moving to the client
- An Infosys BPM notice covering 248 employees in Pennsylvania ties to a “reverse transition” after Vanguard moved some work back in-house, instead of a typical headcount-driven layoff 1.
- Vanguard, a US asset manager, is taking most of those workers onto its payroll while it insources functions Infosys handled under a 2020 strategic partnership 1.
- The shift brings roles back inside Vanguard while it also expands offshore operations, which reduces dependence on third-party vendors 2.
AI is changing onsite staffing and redeployment in big outsourcing deals
- Analysts expect US job cuts to pick up, especially on contracts tied to US$1 billion-plus deals, as AI spreads through delivery work 3.
- Higher productivity from AI can shrink the need for large onsite teams on outsourcing and transformation contracts. That makes redeployment tougher for staff who previously moved over from clients under outsourcing deals, according to Pareekh Jain of Pareekh Consulting, an IT advisory firm 4.
- Infosys calls itself a global leader in “AI-first” business consulting and technology services. It also announced a strategic collaboration with Harness, a software delivery platform company, to speed agentic AI-led software delivery transformation for enterprises 5.
- Reporting on Infosys-related filings says some WARN notices can cover worker transfers or contract changes, instead of direct layoffs 4.
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