Wipro, TCS, to Infosys, why mass layoffs by Indian IT companies come at a social cost

Recentreports suggest that some of Indias major information technology companies, like Wipro, TCS, and Infosys, have collectively laid off over 21,000 employees between June and September this year..

These include accentuating business (down) cycles, souring market sentiments, and deterioration inthewelfare of laid-off workers that the Indian economy can ill afford...

Moreover, mass layoffs during economic downturns can create a crowded job market, making it harder for individuals to find work, especially in specialised fields like IT..

While companies treat layoffs as a cost-cutting instrument to boost performance and, therefore, expect to be rewarded by stock markets, evidence contradicts thisnotion.That is, stock marketsreactnegatively to job cuts in the short term, which is followed by adeclinein a companys financial performance in the medium to long term..

First, a longitudinal employment survey following the same group of individuals over an extended period of time to collect data on livelihoods is necessary for Indian scholars and policymakers to understand the socio-economic consequences of mass layoffs..

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