Deloitte to eliminate 180 advisory roles in strategic overhaul
Deloitte, one of the world’s Big Four professional services firms, has announced plans to axe 180 advisory roles in the UK, citing challenging market conditions. This decision is the latest in a series of job cuts within the firm as it grapples with a sluggish consulting industry and a decline in demand for its services.
The announcement, made to affected staff on Tuesday, underscores the pressures facing consulting firms in the UK. The redundancies will impact employees in Deloitte’s strategy, risk, and transactions division, as well as its technology and transformation unit. While these cuts account for less than 1% of Deloitte’s UK workforce, they reflect broader economic challenges in the sector.
The latest round of job losses follows a string of redundancies at Deloitte UK earlier this year. In September, the firm announced 800 job cuts, adding to 100 positions eliminated in February. Additionally, approximately 250 advisory staff were let go this autumn for underperformance, according to reports from the Financial Times.
Richard Houston, Deloitte UK’s senior partner and CEO, warned in September that the firm needed to make “difficult choices” to manage its cost base effectively. Despite these challenges, Deloitte’s UK equity partners earned an average of over £1 million for the fourth consecutive year, even as the firm reported a slowdown in revenue growth.
Deloitte’s consulting division saw a 1% revenue decline in the financial year ending in May 2023, while its financial advisory practice experienced a 2% drop. This decline is indicative of a broader slowdown in the UK consulting market, which has struggled since the end of the pandemic-driven surge in technology transformation projects.
The sluggish pace of mergers and acquisitions activity has also dampened advisory work in the financial services sector, a key revenue driver for firms like Deloitte. Source Global, a consulting industry research group, forecasts a 2% contraction in the UK’s financial services consulting market in 2024, despite a projected 5% global growth rate in the sector.
Deloitte’s job cuts are part of a larger restructuring effort aimed at streamlining its operations and adapting to market realities. Earlier this year, the firm reorganized its UK business units, reducing them from five to four: audit and assurance, strategy, risk and transactions, technology and transformation, and tax and legal.
This global reorganization aligns with a shift in Deloitte’s focus as it seeks to optimize its services and maintain profitability amid economic uncertainty.Deloitte’s move signals ongoing challenges for the UK consulting industry, which has struggled to regain momentum following the pandemic-era boom. While some growth is anticipated in global financial services consulting next year, the UK’s contraction reflects the localized impact of economic and regulatory pressures.
The layoffs are a stark reminder of the difficult decisions facing consulting firms as they navigate a changing landscape. For Deloitte, the restructuring efforts highlight the firm’s commitment to balancing cost management with its strategic goals, even as it faces an uncertain future in one of its most critical markets.