IT firms are reducing their bench strength as automation, changing workforce models, and visa restrictions reshape hiring strategies. The traditional pyramid model of employment, which relied on a large base of freshers, is shifting towards a diamond structure, prioritising mid-level hiring over entry-level recruitment.
Industry experts note that automation has significantly reduced the need for a large pool of unutilised employees. Pareekh Jain, founder of Pareekh Consulting and EIIR Trend, highlighted how firms historically hired in bulk, trained fresh graduates, and maintained a substantial bench to handle large deals. “Now, with automation, firms realise they may not need as many people in the future, reducing the need for a large bench,” he said.
In addition to automation, IT companies are focusing on increasing workforce utilisation rates. Previously, an 80-85% utilisation rate was considered standard, but now firms are pushing this figure to 85-90% or higher, particularly among global players. The bench strength, which once stood at 15-20% of the total workforce, is now expected to shrink to around 10%.
The hiring focus has also shifted towards mid-level professionals with four-to-eight years of experience, as companies look to enhance their expertise for advanced technology projects, particularly in generative AI (GenAI). Jain explained that companies are aiming to justify premium pricing for AI-driven services by employing experienced professionals rather than fresh graduates.
Ramani Dathi, CFO of Teamlease Services, corroborated this trend, stating that IT companies are set to increase mid-level hiring in FY26. “Entry-level hiring, which contributed to bench strength, may weaken as automation impacts junior roles. The demand is growing for professionals with four-to-eight years of experience,” she said.
Dathi also noted that major IT firms like Wipro and TCS are moving away from maintaining a large bench, opting instead for contract-based hiring to meet just-in-time requirements. “Most of them have brought down their bench capacities to a bare minimum, and based on our discussions, they do not intend to return to previous levels,” she added.
IT giants Infosys and Wipro are still planning to hire over 20,000 and 10,000-12,000 employees, respectively, in FY26, slightly more than what they had done in FY25. However, the recruitment strategy will prioritise skilled professionals over fresh graduates.
This shift is expected to impact Tier-1 IT firms more than mid-tier companies. Jain explained that Tier-1 firms traditionally hired a large number of freshers and invested heavily in training, whereas mid-tier firms relied on hiring experienced talent from the market. “Mid-tier firms typically recruited employees trained by Tier-1s after two-to-three years. With reduced fresher hiring, this model will also be affected,” he said.
Global Capability Centres (GCCs), which relied on Tier-1 firms for trained junior talent, are also expected to face challenges. With fewer freshers being trained, these centres may need to adjust their hiring strategies.
Visa restrictions in the US are another factor reducing the need for a large bench strength. Jain pointed out that firms previously hired freshers, trained them, and sent them abroad. “With H-1B visas and other permits becoming harder to obtain, companies are relying more on subcontractors instead of maintaining a fresher pipeline,” he said.