With Big Four advisory and audit firms continuing to reckon with falling demand, EY has become the latest firm to announce cuts to its UK headcount. The firm reportedly set to cut 150 roles in its UK consultancy division, while also having to replace one of its most senior executives in the team.
Major consulting firms have struggled to adjust to adapt to fluctuations in demand since the Covid-19 pandemic. While the Big Four enjoyed a major boost to growth amid the crisis period, the years since have seen consulting growth return to normal levels – and left firms with inflated headcounts eating into the profits of their stakeholders.
EY’s global annual report revealed a reduction of 2,450 employees over the past fiscal year. But in October, EY reported its weakest annual revenue growth in 14 years at 3.9% across the firm – leading the consulting giant to weigh up more cuts.
The firm’s UK consulting practice is currently around 4,700 professionals strong. However, according to reports from The Times, EY is planning 150 redundancies in the team, which are expected to impact managers, senior managers and directors – the highest-paid roles below partner level.
An EY spokesperson commented, “EY regularly reviews the resourcing needs of the business. Regrettably, proposals put forward in part of the UK consulting practice may result in a reduction of 150 roles. A consultation process is now underway with those impacted by these proposals.”
As mentioned, EY is not the only Big Four firm to be taking such measures. Earlier in the autumn, Deloitte announced it plans to lay off 180 of its own consulting staff. Meanwhile, according to a Wall Steet Journal, PwC US plans to lay off 1,800 employees – or 2.5% of its 75,000-person workforce, while KPMG has similarly announced plans that will affect about 4% of the firm’s roughly 9,000 auditing staff in the US alone.
For EY, however, the news also comes as the firm looks to replace its UK and Ireland managing partner of consulting, Benoit Laclau. Laclau, who joined EY 13 years ago, but is stepping down after five years in the role – according to City AM, he will instead continue to serve large EY clients and lead its “technology driven pursuits in the UK”.
The move underscores some of the challenges Anna Anthony will inherit, when she becomes the first-ever woman to lead a UK Big Four firm. Anthony was selected by EY’s leadership earlier in 2024, but will face multiple pressures when she assumes the position in January 2025 – especially as key public sector contractors look to scale back their use of large consulting firms.