KPMG to shed up to 200 UK jobs amid dented revenues
Big Four professional services firm KPMG is reportedly mooting the axe for as many as 200 of its UK employees. The firm has suffered a slump in demand due to the coronavirus pandemic and the recession which has followed it.
Earlier in the summer, Grant Thornton became the first top-table professional services firm in the UK to announce layoffs, axing around 70 jobs in its tax and consulting divisions. Deloitte meanwhile scaled back its global headcount by around more than 7,000 – though along with fellow Big Four members PwC, KPMG and EY – the firm looked to avoid job losses by instead reducing partner pay to save money during the Covid-19 pandemic.
As the second half of 2020 has progressed, however, it has become apparent that the global economy is not going to return to the state it was in pre-pandemic. A number of key markets had already been teetering on the brink of recession prior to the coronavirus outbreak, and the disruption caused by the international lockdown used to curb its spread now seems to have shunted the world into an unprecedented downturn. As a result, many of the larger consulting firms which might have hoped to weather the storm without cutting jobs are having to return to the drawing board.
With client demand having collapsed amid the initial pandemic, KPMG has become the first Big Four firm in the UK to announce redundancies, as its depleted workbook struggles to recover. As reported by Sky News, the firm has confirmed that as many as 200 jobs are on the line amid its British workforce, hot on the heels of the announcement from Accenture in July that the professional services giant was set to cull roughly 8% of its UK headcount.
According to further coverage from the Irish Times, KPMG announced it plans to cut fewer than 100 roles from its 3,000 member consulting business, alongside a similar number from back office support staff in departments like HR. Partners and affected employees have been informed about the proposals in a briefing by Bill Michael, KPMG’s UK Chair. A statement from KPMG meanwhile clarified that while areas such as cybersecurity were in high demand, it is a different story in other consulting roles – and these are the ones in jeopardy.
While KPMG’s move is notably less drastic than the plans of Accenture, the firm’s cost-saving drive accelerated by the coronavirus pandemic also includes slashing its contributions to employees' pension pots – similarly to rival Deloitte. A consultation on reducing employer pension contributions of 4.5% of salaries has already begun; something which will disproportionately affect older staff. A source close to the firm told Sky News that about one-fifth of employees would be impacted because, with an average age of 27, most KPMG staff already had pension deals entitling them to 4.5% contributions.
