Accenture latest consultancy to announce major job cuts

29 March 2023 3 min. read
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Another 19,000 consultants and tech workers are set to lose their jobs with Accenture announcing a near 3 percent reduction in its almost 738,000-strong workforce.

Professional services firm Accenture has flagged large cuts to its global workforce, with almost 20,000 jobs to be lost, or around 2.5% of its total headcount.

Scaled to Australia and New Zealand, that would equate to more than 150 regional retrenchments out of an approximate 6,500 workers, with in particular back office staff facing the axe in a mirror of McKinsey & Company’s recent global cut of up to 2,000 professionals.

Accenture latest consultancy to announce major job cuts

“Locally, it will be non-billable with very limited impact on client facing, as we have focused on performance achievement,” a senior source told the Australian Financial Review, while an official Accenture spokesperson declined to comment. “We are still growing locally as well and hiring in high-demand areas,” the source added, although around 800 senior leaders in “markets and services” are also expected to lose their jobs at the global level.

Also akin to McKinsey, the cuts are occurring amid record global revenues, but with the consulting market feeling a squeeze due to business apprehension brought about by rampant inflation and other global economic factors. Having raked in almost $16 billion over the past three months, Accenture in its first-half reporting also slightly scaled back its annual profit forecast, from between 8 percent and 11 percent growth down to 8 percent to 10 percent.

While the wreckage across the tech sector continues by the week (with the likes of Atlassian among those announcing significant cuts), Accenture and McKinsey aren’t the only consulting firms to be also scaling down, with KPMG slashing some 200 jobs as well. Other firms however, including Boston Consulting Group and KPMG’s Big Four rivals, have locally ruled out such an approach, especially after struggling to fill positions over the past two or so years.

The consulting job market has experienced a number of consecutive shocks in recent times, both in terms of job losses and a brief, highly employee-friendly landscape, including in Australia. Riding high prior to the onset of the global pandemic in early 2020, many of the country’s biggest consultancies scrambled early to stem their losses, including KPMG, Deloitte and PwC, before then getting stuck for staff in an unexpectedly buoyant consulting bounce-back.

With borders closed and a lack of digitally-skilled workers, local consultants and accountants enjoyed a period of record wage rises and an almost endless series of additional perks, such as being given the luxury of working remotely for eight weeks of the year. Then the conflict in Ukraine began, the global economy started to tank, and suddenly those who could be picky about their workplaces just twelve months ago are now facing the prospect of unemployment.

Accenture stated that it had put aside $1.5 billion to manage the cuts, including $1.2 billion in severance payments, while half of the slated layoffs are to occur before the end of the fiscal year. “While we continue to hire, especially to support our strategic growth priorities, during the second quarter of fiscal 2023 we initiated actions to streamline our operations and transform our non-billable corporate functions to reduce costs.” the firm said in a filing.

Meanwhile, Accenture last week closed two deals, one in France and another in India, as the firm continues to invest in “high demand” areas of its business.