Deloitte Layoffs To Hit 1,200 US Workers As Consulting Business Slows: Report
‘Our US businesses continue to experience strong client demand. As growth in select practices moderates, we are taking modest personnel actions where necessary,’ wrote Deloitte in response to a CRN request for further information.
Deloitte confirmed to CRN that it plans to begin layoffs impacting its U.S. workforce with, according to one report, as many as 1,200 positions affected.
The Financial Times reported Friday that the global professional services company expects to cut about 1,200 jobs, or about 1.5 percent of the company’s U.S. workforce.
Deloitte’s Risk and Financial Advisory division is expected to see a larger proportion of layoffs, about 3 percent of that company’s staff, due to decreased merger and acquisition activity, according to the FT and a posting on thelayoff.com.
The planned layoffs were communicated to Deloitte employees last Thursday.
Deloitte, in a statement not attributed to a specific executive, responded to a CRN request for further information with confirmation that layoffs are happening.
“Our US businesses continue to experience strong client demand. As growth in select practices moderates, we are taking modest personnel actions where necessary,” Deloitte said.
News of the layoffs came shortly after Deloitte rival Ernst & Young unveiled plans to lay off about 5 percent of its U.S. workforce after the U.S. business rejected that company’s plan to break up its audit and consulting units, Reuters reported.
The news also follows that of Accenture which in March unveiled plans to lay off 19,000 employees, or 2.5 percent of its workforce, as part of a company optimization push.
Large multinational consultant layoffs are coming in the wake of lower expectations about the performance of the U.S. economy.
Investment bank and financial services company William Blair, for instance, in January cited data from the U.S. Federal Reserve to say real GDP growth for is expected to be about 0.5 percent, down from October, 2022 expectations of 1.2 percent growth for this year.
William Blair’s London-based macroeconomist Richard de Chazal, writing in a press statement, said that multiple factors including high inflation, geopolitical turmoil, housing market weakness, possible supply chain disruptions, and over-tightening by the Federal Reserve to curb inflation all lead to the increasing possibility of a U.S. economic recession in 2023.
“What is different about this expected economic downturn from the last few is that this recession is not being driven by a pandemic or a major financial collapse,” de Chazal said. “Rather, it would seem to be following the classic pattern of overly strong demand leading to higher inflation and a central bank that has to step in to bring inflation back down.”