Deloitte cuts jobs after economic conditions bite consulting sector

The audit and consulting firm has moved to slash jobs after months of attrition in the professional services giant’s headcount.

Deloitte Australia will cut jobs amid tough times for the consulting sector.

Deloitte Australia has blamed the economic downturn and “challenging” market conditions for the decision to push through further headcount cuts following months of attrition at the professional services giant.

Staff at the audit and consulting firm were notified of the redundancy round, with Deloitte boss Adam Powick facing a barrage of questions over the headcount cuts in a firm-wide call on Friday.

Mr Powick, who holds the quarterly calls with staff, emphasised the were cuts highly targeted, coming after months of attrition at the firm.

Deloitte’s headcount has been sliding for months, with the firm shedding at least 20 partners and 305 total employees between the end of May and September this year.

It is understood this figure represents people who have left the firm voluntarily as well as headcount reductions.

Deloitte was unable to provide data through to October.

The firm told The Australian that Deloitte had 1001 partners at the end of September, plus a further 11,751 employees.

But this was down on the 1021 partners at Deloitte as of May this year, when the firm ruled off its full-year results.

Deloitte confirmed at the time it had a total of 12,056 employees in May.

A firm spokeswoman said Deloitte’s management “regularly review our hiring priorities and workforce composition against market demand”.

“The current market and economic conditions are challenging and we are seeing some meaningful changes in how our clients are buying some of our services,” she said.

“We have taken considered action where we have seen significant structural shifts in client need but we continue to hire into areas where demand remains strong.”

The latest round of cuts is targeted at senior levels in the firm, concentrated in highly paid non-partner roles.

In July, Deloitte revealed it experienced a $150m revenue slump in its financial year through to May.

At the time Mr Powick noted the firm was facing tough conditions, but confirmed Deloitte would continue to invest and hire in growth areas of the firm.

Deloitte is also preparing to elect its new chief executive, with partners at the firm soon to be called to vote on Mr Powick’s replacement.

Deloitte appointed John Greig as the firm’s new chair in March.

The latest round of cuts comes amid a challenging period for the audit and consulting sector, which has benefited from several big years of business.

Deloitte overhauled its structure in March in a global restructure, which the firm said at the time would see no job losses in Australia. However, Deloitte’s US business slashed 1200 staff in April.

KPMG slashed 200 senior roles in June, in an $80m cost-cutting exercise across the audit and consulting firm.

That firm also slashed partner distributions by 9 per cent in August.

Originally published as Deloitte cuts jobs after economic conditions bite consulting sector