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Cognizant is set to cut at least 6,000 jobs, which represents 2.3% of its total workforce, as it struggles with growth in an IT environment that is fast shifting towards new digital services. The variable payout to employees for 2016, too, is expected to be adversely affected.
The layoffs are likely to be more this year than the routine annual exercise that weeds out the bottom 1% of the workforce for non-performance as determined by the annual appraisal process that ends in March. The company is said to be looking to cut roles that have become redundant due to the impact of automation on lower-end IT jobs. Last year, the layoffs were about 1-2% while two years ago, it was about 1%. Cognizant had 2,60,200 employees globally as on December 31, with 1,88,000, or 72%, based in India. It was not immediately clear how many jobs in the country or which roles would be made redundant. The company faced one of its most challenging times last year, with full-year growth down to single digits, 8.6%, after many years of strong double-digit industry leading growth.