More than 330 positions at the multinational consulting firm PwC will be eliminated in Australia as it works to recover from a controversy involving the improper use of private Treasury data.
The partnership is to close its “skilled service hub” in South Australia, which has served clients in the public and private sectors since 2021. A total of 141 employees, including several auditors, will be laid off. There will be a 200 or so employee transfer to the company’s nationwide workforce.
The firm has ascribed the additional 197 PwC Australia layoffs to “the reduction in the size of the business, the firm’s changing portfolio and strategic areas of focus, and economic headwinds.” The layoffs will affect the whole national workforce.
Earlier this year, after numerous ministries declined to offer it new business, PwC Australia sold its government consulting division to private equity firm Allegro Funds for a mere $1. Approximately 20% of the company’s revenue came from the division. To save jobs, Scyne Advisory, a new spin-off company, was established.
On Wednesday, PwC Australia said that 75 employees who were scheduled to be relocated to Scyne Advisory would also be laid off following their last-week leave of absence. Although the employees were urged to look for other opportunities within PwC Australia, the company stated that this was “not always possible or desired by the individual.”
In a statement, Burrowes stated, “These are incredibly difficult decisions and my thoughts are with all of those people and their families impacted by the changes we have been forced to make.”
Although we have hope for the future, PwC needs to be realistic in order to handle these obstacles and make tough choices in order to satisfy its clients’ expectations and maintain the firm’s long-term prosperity.
“We are thankful to our people for their perseverance and commitment on behalf of their clients, and we will keep providing the best caliber of service and professionalism to our clients in South Australia and the rest of the nation.”
The company will provide recent graduates who are scheduled to begin working in its consultancy division the option to willingly postpone their positions for a period of six to twelve months.
This year, KPMG and Deloitte, two of the other Big Four consulting firms, have reduced their workforce. The federal and state governments are attempting to outsource more work and have been evaluating how much of it they conduct in-house.
Westpac ended a 55-year relationship with PwC Australia and its partners on Wednesday when it declared that it will not be renewing the audit contract. Westpac stated in a statement to the ASX that the choice was in line with “best practice for audit firm rotation.”
Additionally, PwC UK has announced 600 job losses, or 2.4% of its 25,000+ workforce. Employees in its tax department will also be impacted, but mostly in its advising business.
A year ago, PwC said that over 1,000 of its UK partners will receive £906,000 (A$1,730,000) each, which was a modest decrease from the record awards of £920,000 basic salary plus a £100,000 bonus. The disclosure comes just months after PwC made this revelation.
Kevin Ellis, the chair of PwC UK, defended the company’s choice to reduce staff instead of partner profits. He told the Financial Times, which broke the story first, that “you have got to be competitive at all grades, including the partner grade,” when managing a corporation.
According to executives, PwC partners in Australia may see compensation reductions of up to 30% in this fiscal year in order to preserve the wages of less experienced employees. The average partner salary fell by 12% in the previous fiscal year.