The first four months of 2025 have seen Indian startups and leading companies continue to streamline their workforce as they adapt to a changing funding environment and evolving business models. While the overall pace of layoffs has slowed compared to the previous two years, the impact remains substantial, especially in the technology and startup sectors. The funding crunch that began in 2022 led to more than 30,000 layoffs by late 2023, and although the situation has improved, companies are still making tough decisions to ensure profitability and operational efficiency
Funding Recovery and Improved Hiring Sentiment
A notable trend in 2025 is the improved funding landscape for Indian startups, with funding increasing by 14 percent year-on-year and reaching $10.9 billion in 2024. This has resulted in a 46 percent year-on-year drop in layoffs in 2024, with 8,895 layoffs compared to 16,398 in 2023. As a result, staffing firms project a 20-30 percent increase in hiring among startups heading into 2025, signaling renewed confidence and a gradual shift from survival mode to growth. However, the effects of the previous funding winter are still visible, with companies continuing to optimize costs and restructure teams.
Company-wise Layoff Table (Jan 2025 – April 18, 2025)
| Company | Sector | Month | Number of Employees Laid Off | Remarks |
|---|---|---|---|---|
| Blissclub | Fashion Apparel | January 2025 | ~21 (18% workforce) | Restructuring, creative team dissolved |
| WayCool Foods | Agritech | February 2025 | 70 | Funding challenges, restructuring |
| Flipkart (ANS Commerce) | E-commerce | February 2025 | Undisclosed | Shutdown of acquired unit, transition support |
| Paytm | Fintech | Late 2024–2025 | ~1,000 | AI-led automation, efficiency drive |
| Loco | Gaming | Late 2024–2025 | 40 (36% workforce) | Realignment amid GST challenges |
| Ola Electric | Electric Vehicles | March 2025 | 1,000+ | Second round of layoffs, restructuring |
| Dr Reddy’s Laboratories | Pharmaceuticals | April 2025 | Undisclosed | Workforce trimming initiated |
| Infosys | IT Services | April 18, 2025 | 1,000+ | Cost optimization and restructuring |
Shifting Workforce Dynamics
The layoffs in 2025 have primarily affected mid-level managers and non-core staff, as companies focus on retaining critical talent and investing in roles that drive growth and innovation. Startups are increasingly hiring freshers, with 53 percent of all job openings in startups from April 2023 to 2024 targeted at young professionals and recent graduates. This shift is driven by the need for adaptable, cost-effective talent and reflects a broader move towards building agile teams that can navigate uncertainty.
Sectoral Overview and Outlook
Technology, fintech, e-commerce, and consumer services remain the most affected sectors, with companies in these areas continuing to adjust their workforce in response to automation, AI adoption, and changing consumer behavior. The pharmaceutical and agritech sectors have also seen targeted layoffs as part of broader restructuring efforts. Despite these challenges, the overall employment scenario is showing signs of stabilization, with improved funding and a renewed focus on hiring, particularly in IT services and core technology roles.
While the layoff wave that began in 2022 has not fully subsided, the Indian startup and corporate ecosystem is gradually transitioning towards recovery. The data up to April 18, 2025, highlights both the lingering effects of the funding winter and the early signs of renewed growth and hiring. Companies are making strategic decisions to ensure long-term sustainability, and the workforce is adapting to new realities, with freshers and skilled professionals finding new opportunities as the sector stabilizes.
