KPMG has cut hundreds of UK contractors as part of a cost-saving drive, according to people familiar with the matter. The move affects around 200 roles across the firm, with the majority being contractors in its consulting and audit divisions.
Details of the Cuts
The cuts come as KPMG seeks to reduce costs amid a challenging economic environment. The firm has been reviewing its contractor workforce as part of a broader efficiency drive. According to one source, the cuts are focused on contractors who are not deemed essential to the firm's core operations.
KPMG has been under pressure to cut costs as the consulting industry faces a slowdown in demand. The firm's UK revenue growth has slowed in recent months, and it has been looking to reduce its cost base to protect margins.
Impact on Staff and Operations
The cuts are expected to affect around 200 contractors, with some being let go immediately and others having their contracts terminated early. The firm has not disclosed the exact number of contractors affected, but sources say the cuts are significant.
KPMG has been working to streamline its operations and reduce costs across the business. The firm has also been reviewing its use of contractors as part of a wider effort to manage its workforce more efficiently.
Broader Industry Context
The cuts at KPMG come as the consulting industry faces headwinds from the economic downturn. Many firms have been cutting costs and reducing headcount in response to slowing demand. KPMG's rivals, including Deloitte, PwC, and EY, have also been making similar moves.
According to a recent report, the UK consulting market is expected to grow at a slower pace in 2024, as clients become more cautious about spending. This has led to increased competition for work and pressure on firms to cut costs.
KPMG's Response
KPMG declined to comment on the specifics of the cuts. However, a spokesperson said: "We are constantly reviewing our business to ensure we are operating efficiently and effectively. This includes making changes to our contractor workforce as needed."
The firm said it is committed to supporting affected contractors and will provide them with notice and any contractual entitlements.
