McKinsey to cut up to 2,000 staff in one of its biggest round of layoffs ever
McKinsey is planning to cut up to 2,000 back-office staff as it seeks to control costs and retain its partner payouts.
The plans could affect up to 2,000 of McKinsey’s 45,000 staff, in one of the consulting firm’s largest rounds of job cuts ever.
McKinsey’s plans, first reported by Bloomberg, are set to see the firm cut swathes of back-office workers in its communications, technology, and human resources departments.
A McKinsey spokesperson told City A.M. the firm is “redesigning the way our non-client serving teams operate for the first time in more than a decade.”
The company spokesperson noted that McKinsey, however, will “continue to hire client-serving professionals and invest in our ability to serve clients.”
The cuts will also steer clear of McKinsey’s legal and compliance departments, which have been bulked up in the wake of scandals including links to corruption in South Africa and the US opioid crisis.
Labour shortages have also forced the consulting firm to increase partner pay in an effort to prevent talented staff being pinched by rivals offering bumper pay packets.
First established in 1926, McKinsey is now considered to be one of the world’s ‘Big Three’ consulting firms, alongside Bain & Co and Boston Consulting Group (BCG).
The firm took in a record $15bn revenues in 2021, on the back of a boom in demand for consulting services, leading to bumper payouts for its more than 2,000 partners.
News of McKinsey’s plans follow reports that KPMG is set to lay off 700 US staff, due to the impacts of a slowdown in M&A activity on its deals advisory business.