KPMG last week told approximately 330 people—or nearly 4% of its roughly 9,000-person U.S. audit workforce—that they would be losing their jobs in the coming weeks, the Wall Street Journal reported on Monday.
The job cuts will impact employees such as audit associates and managers but not partners, according to the WSJ.
The reason for the layoffs: low levels of voluntary turnover at the Big Four accounting firm. Mark Maurer of the Wall Street Journal wrote:
KPMG is among the large accounting firms that have continued to experience slower-than-expected levels of voluntary attrition after aggressively hiring people during the pandemic. Layoffs at several firms have focused on the advisory side, for which revenue growth has generally slowed as corporate clients pull back on certain services, as opposed to audit.
PwC most recently announced job cuts internally, as the WSJ reported on Sept. 11 that the Big Four firm would be trimming approximately 2.5% of its U.S. workforce—roughly 1,800 employees—primarily in its advisory practice and products and technology operations. These job cuts also included employees in business services, audit, and tax. Affected employees were told last month—even up to a week ago.
Maurer noted that these most recent KPMG layoffs come after an audit-focused round last March. In June 2023, KPMG laid off about 5% of its U.S. staff—including advisory, tax, and back-office workers—after cutting some advisory personnel, or almost 2% of U.S. staff, earlier in the year.
Deloitte and EY let go of 1,200 and 3,000 employees, respectively, in April 2023.
In a statement to the WSJ, KPMG said about its latest reduction in force, “The actions reflect our ongoing focus to align the size, shape, and skills of our workforce to the market, while addressing continued low levels of attrition. We remain focused on investing in our people to grow our business with quality.”
A thread on r/accounting hinted about the pending KPMG audit layoffs a week ago. After the news was announced internally, one person commented in a different thread about the layoffs that “10 years ago and longer you could basically stay [at a Big Four firm] as long as you wanted if you were performing OK.” This person added that the biggest issue is the “tons of offshoring right now.”
“Big 4 and most firms are just sending all the work to India and other foreign countries. Also AI will take jobs too as it will make existing employees more productive,” the commenter wrote.
Another person said they didn’t understand how the Big Four firms can complain about an accountant shortage when they’re laying people off. It elicited the following response, “The shortage has nothing to do with how many employees an individual company can bear. Big Four hired anybody that could fog up a mirror in 2022/2023 and they’re cutting back, almost exclusively in consulting.”
In a thread on r/Big4 about the WSJ’s article on the KPMG layoffs, one person commented that audit teams are already understaffed and “if anyone leaves during busy season, it’ll be near impossible to find someone with time to replace them.”
This person, presumably a KPMG employee, added, “It feels like a lot of colleagues are disgruntled, and many are actively discussing leaving. Bonuses were mediocre and raises haven’t been in line with competing firms. People will remember how the firm treated them when things got rough, and I think that as soon as the job market improves, a lot of people will jump ship.”
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Tags: Accounting, Auditing, Firm Management, Staffing
