Sources: 
Indian startups have laid off approximately
3,600 employees in the first five months of 2025 amid a growing push towards AI-driven automation.
This wave of job cuts is largely attributed to startups leveraging generative artificial intelligence to streamline operations, automate manual tasks, and reduce costs.
Among the affected companies,
VerSe Innovation, the parent company of DailyHunt and Josh, cited a "workforce realignment" aimed at investing more in AI, improving operational efficiency, and focusing on long-term growth.
Similarly,
Ola Electric has laid off
1,000 employees due to automation of some front-end operations, signaling a shift in the startup ecosystem where job security is increasingly uncertain.
Financial pressures also play a role, with
67 out of 112 startups that released FY24 financial statements reported as loss-making entities, prompting cost-cutting measures including layoffs.
The rise in generative AI usage over recent years has accelerated this trend, enabling startups to reduce reliance on human labor while aiming to curb losses and enhance operational efficiency.
This shift reflects a broader transformation in the Indian startup landscape, where AI adoption is reshaping workforce dynamics and challenging traditional employment models.
As startups continue to balance growth ambitions with financial sustainability, the impact on employment remains a critical concern for the sector.
Sources: Indian startups have laid off about 3,600 employees in early 2025, driven by a shift toward AI automation to reduce costs and improve efficiency. Companies like VerSe Innovation and Ola Electric are realigning workforces, reflecting a broader trend of startups cutting jobs amid financial losses and AI adoption.
