Big Four firm KPMG has announced that it will be cutting 700 jobs in its US advisory team. This will constitute 2% of its US workforce, making KPMG the first of the Big Four team to officialise the laying off of employees amidst a period of economic uncertainty for companies throughout the globe.
These cuts were announced internally by KPMG US vice-chair for its advisory business, Carl Carande, according to a report by the Financial Times. In this internal memo, Carande is quoted as having said that these cuts were needed “to better align our workforce with current and anticipated demand in the market.”
A spokesperson for KPMG US offered the International Accounting Bulletin the following statement:
“Our business and outlook remain strong. However, we have experienced uncertainty affecting certain parts of our Advisory business that drove outsized growth in recent years.
“We have reduced expenses and prioritised investments in those areas and remain confident in the future of our firm and these services. However, we are taking prudent actions to match our resources to the needs of the market today.
“These actions are incredibly difficult and impact people’s lives. We are supporting our colleagues with a holistic package that includes severance, healthcare, emotional and well-being support, career counselling, and learning and development opportunities.
“We continue to make strategic investments for the future of our business and to deliver with quality and excellence in FY23 and beyond. In these moments we lead with our Values and are focused on supporting all of our colleagues.”
KPMG, however, is not the only firm to have taken action in light of the present economic uncertainty, as seen with EY’s cuts on holiday bonuses for its staff members in the US. Additionally, equity research firm William Blair reports that job postings by Big Four firms have decreased by 50% compared to last year.
The struggle faced by the Big Four answers to a sharp decrease in M&A activity around the globe, a state of affairs which has directly impacted the deal advisory branches in the industry.
The International Accounting Bulletin has reached out to KPMG for further commentary, and this article will be updated as more information becomes available.