Accenture, the Irish-American professional services company, has announced that it will cut approximately 19,000 jobs, equivalent to 2.5% of its global workforce, over the next 18 months in an effort to reduce costs. The majority of the job cuts will be concentrated among back-office staff. Accenture will spend $1.2 billion on severance packages and another $300 million on consolidating office space. The company stated that it will continue to hire but will also streamline operations and transform non-billable corporate functions to save costs.
Despite its plans to cut costs, Accenture lowered its revenue growth forecast for the 2023 fiscal year to between 8 percent and 10 percent from its previous estimate of between 8 percent and 11 percent. In the tech industry, hundreds of thousands of employees have been laid off since the end of last year due to a decrease in demand resulting from high inflation and increasing interest rates.
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Accenture’s rivals, such as McKinsey and KPMG are also cutting their workforce to save money. KPMG reportedly announced that it will cut close to 2% of its US workforce due to an expected decrease in client demand. Additionally, reports also revealed that McKinsey may lay off up to 2,000 non-consulting employees in one of its largest rounds of job cuts ever.