PwC plans to slash up to 600 jobsby
Following its Big Four cohorts in cutting jobs, PwC is set to shed up to 600 jobs from the consultancy arm of the firm and also a small number from the tax department.
According to a report from the Financial Times this morning, PwC is planning to offer voluntary redundancy for 500 to 600 people. However, if not enough employees step forward, the Big Four firm will switch to compulsory redundancies.
Kevin Ellis, the chairman of PwC, confirmed the news to the FT, adding that the cuts will affect employees from directors to juniors, with the brunt landing at the bottom end of the hierarchy. However, those in their first year with the company will be spared from the redundancy round.
Ellis said that the firm had chosen to go down the redundancy route rather than nixing job offers to graduates or school-leavers out of “fairness” for those at the start of their careers and not impacting the firm’s diversity and social mobility efforts.
The redundancy plans come hot on the heels of PwC partners’ pay dropping from over £1m last year to £906,000. While partner pay fell, the Big Four firm’s annual accounts reported revenue increasing by 16% and every business line also showing growth.
In a statement, a spokesperson from PwC told AccountingWEB: “In light of lower than normal attrition rates and subdued growth in parts of the business, we are making targeted voluntary severance offers to some of our people. Decisions about jobs are never taken lightly – this is about flexing our business to demand. There are still areas of good growth and recruitment.”
Big Four redundancies
PwC is the latest of the Big Four firms to cut jobs after going on a hiring boom during the pandemic. Deloitte confirmed to Sky News in September that more than 800 roles were at risk of redundancy. The Big Four firm put the “targeted restructuring” down to a “slowdown in growth” as a result of the “ongoing economic uncertainty”.
EY has also recently warned employees in the summer that it’s going to slash around 150 jobs in the business transformation and risk management teams, representing 5% of the financial services practice.
The news came as EY partners saw their payouts cut by more than £40,000 as profits crept up at a slower pace of 3.9% while the firm wrestled with the backroom drama of the collapse of the Project Everest plans to split the firm.
The rise in Big Four redundancies comes as the market is still growing, and the firms have all reported growth across the different areas of the business. However, the FT recently found that the UK is lagging behind other areas, such as the Middle East. It puts this down to rising interest rates and growing economic uncertainty, which has led to a reduced amount of mergers and acquisitions and as a result less of a demand for consultants.
Excessive hiring during the pandemic has been put forward as another reason behind the Big Four firms’ recent decision to shed jobs, combined with employees also sticking around longer as other opportunities have dried up due to the uncertain economic climate.