Consulting division hit in KPMG’s fist wave of Australian job cuts

KPMG’s workers in Australia will pay for the misdeeds of its senior leaders with over 350 – or 4 percent of its local labour force – set to lose their jobs following the firm’s data sharing scandal.

However, not all senior members of KPMG will be spared, with 27 partners also exiting the firm alongside 360 employees in the first wave of redundancies. The number of casualties is also expected to grow, with potentially 1,000 professionals eventually out of work.

In another display of PR mismanagement since the firm’s data sharing scandal came to light, KPMG announced the widespread job cuts to staff on the same day as publishing its annual revenues, which were down by just 1 percent to date to $2.1 billion with the impact yet to bite.

The majority of those axed will be from the firm’s consulting division – which fell by a further 17 percent over the past twelve months to $632 million, a far cry from highs exceeding $1 billion just three years ago. As a further cruel twist, it’s anticipated staff from KPMG’s audit division will shortly follow their consulting colleagues – once the current audit season soon winds up.

“After careful consideration, we have made the difficult decision to reduce our workforce and restructure parts of the firm,” said newly-installed CEO John Sams. “This is not a decision that has been taken lightly, and we know it will have a very real impact on people. With demand for consulting remaining weaker, most of the roles affected will be within that practice.”

In addition to former CEO Andrew Yates and chair Martin Sheppard, as well several prominent senior leaders deemed responsible for the client confidentiality breaches or subsequent failings, the 27 partners departing the firm add to the 50-odd who have already left. Those remaining, around 700 in total, will cop a 13 percent reduction in their average pay, or roughly $72,000 apiece.

Meanwhile, the firm has performed yet another organisational restructure following the one made in just 2023, with its mid-market & private deals team to join KPMG’s weakening deal advisory & infrastructure practice and its advisory team added to the firm’s consulting division. This has seen employees with internal business services roles also caught up in the first round of cuts.

“These changes are intended to put the firm on a more sustainable footing and ensure we remain aligned with our client’s needs, and are an important step in the longer work of renewing and rebuilding our firm,” Sams said. “We will continue to monitor performance closely, act when needed, and carefully consider how the firm needs to be set up for the future.”

That short-term future looks possibly bleaker than when PwC – which has now returned to growth – tripped itself up in 2023, with KPMG not only ruining its reputation in the local audit market, which last year accounted for a $400 million-plus slice of its total revenues, but in also having to contend with an angry and impatient government, being previously its greatest beneficiary among rivals.