KPMG, one of the world’s leading accounting firms, has announced its plans to lay off approximately 5 per cent of its workforce in the United States, Moneycontrol reported on Monday. The decision comes as the company grapples with economic headwinds and historically low attrition rates. With over 39,000 employees in the U.S. as of September 30, 2022, KPMG’s job cuts are expected to affect more than 1,900 employees.
This marks the second major round of layoffs for KPMG this year, following the release of approximately 700 employees in February. The firm’s latest job cuts will be implemented throughout its 2023 financial year. In a statement cited by Moneycontrol, KPMG emphasized that the decision was deemed necessary for the firm’s long-term interests and continued success in the future.
Like many others, the accounting industry has been navigating a challenging economic climate. The impact of the COVID-19 pandemic, coupled with economic uncertainties, has prompted companies to reevaluate their workforce and make necessary adjustments to sustain operations.
The Great Layoff Phenomenon
The layoffs at KPMG are part of a broader trend witnessed across various industries. Companies are proactively trimming their workforce to batten down the hatches and prepare for potential economic downturns. Ernst & Young (EY), a member of the Big Four, shed 5 per cent of its workforce in April. Deloitte, another major player in the accounting industry, has also reported job cuts.
Moreover, KPMG’s job cuts align with recent layoff announcements from other prominent companies. Goldman Sachs, the renowned investment bank, is reportedly slashing 125 managing directors in its latest round of job cuts over the past 12 months. Robinhood, the online brokerage platform, is cutting 7 per cent of its staff. Additionally, Ford, Uber, Oracle, Grubhub, and Spotify have all announced significant layoffs this year.
The increasing number of layoffs in various industries indicates a growing concern among companies regarding the potential impact of an economic downturn. These measures are taken to streamline operations, reduce costs, and navigate challenging market conditions. While specific details regarding the number of employees affected vary across companies, the overall trend highlights a cautious approach taken by businesses. The accounting industry, in particular, has faced significant challenges with the emergence of new technologies and shifting client demands.
The impact of these layoffs extends beyond the affected employees. It poses concerns for the overall job market and the economy at large. As more companies reduce their workforce, the job market becomes increasingly competitive, making it more challenging for individuals seeking employment opportunities. The ripple effects of these layoffs can be felt throughout various sectors and industries.
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