McKinsey begins hundreds of job cuts with client demand muted: sources

MCKINSEY & Co is beginning to eliminate roughly 360 jobs as the consulting giant deals with a slowdown in demand for its services.

The reductions are global and will affect employees across a variety of divisions including design, data engineering, cloud and software, according to people familiar with the matter. The cuts are expected to impact about 3 per cent of the 12,000 staffers who are considered specialists or have technical expertise that work alongside the firm’s traditional consultants, one of the people said, asking not to be identified discussing personnel information.

“We invest to grow capabilities that match our clients’ priorities, and adjust the size of a small number of others as appropriate,” a McKinsey spokesperson said in an e-mailed statement. “As part of this process, some roles will be eliminated within this small number of capabilities.”

Traditional consultants will not be affected by the dismissals, the person familiar with the matter said. McKinsey has more than 45,000 staffers in 130 cities around the world, according to its website.

After the boom times of the pandemic spurred hiring sprees across the consulting industry, firms including Ernst & Young and PricewaterhouseCoopers have more recently had to turn to job cuts as a growing number of clients shelve longer-term investments. Last month, Accenture shares tumbled after the company warned it has seen financial services customers pull back their spending on its software.

McKinsey generated a record US$16 billion in revenue last year. Still, the firm has warned about 3,000 of its consultants that their performance was unsatisfactory and will need to improve. The company in recent weeks has also offered UK staffers to take nine months pay in exchange for their departure. BLOOMBERG