Skip to content

McKinsey implements job cuts equating to 10% of its workforce as part of significant restructuring plan.

McKinsey Consulting firm cuts 10% of its employees to scale back operations, a move aimed at reversing its expansion during the pandemic period.

McKinsey, a renowned consulting firm, has decided to lay off a tenth of its employees in an attempt...
McKinsey, a renowned consulting firm, has decided to lay off a tenth of its employees in an attempt to curtail its earlier growth spurt, which was a response to pandemic-induced demands.

McKinsey implements job cuts equating to 10% of its workforce as part of significant restructuring plan.

McKinsey, one of the world's leading consulting firms, has executed a significant workforce reduction, affecting approximately 10% of its staff, according to sources quoted by the Financial Times. This latest move follows the scaling back of the company's expansion plans, which had been on an upward trajectory during the pandemic. The company's current workforce stands at 40,000, having diminished from 45,000 over the past 18 months.

This downsizing comes amidst a downturn in revenue across the sector, although McKinsey's 2024 report, recently unveiled earlier this month, does not provide definite figures on staff numbers or annual revenue. The company reported a revenue of $16 billion for 2023.

In addition to the job cuts, McKinsey has faced substantial legal payouts, totaling $1.6 billion, related to its work with US opioid manufacturers. Allegations suggest that the company advised manufacturers like Purdue Pharma to aggressively boost OxyContin sales, even as overdose deaths rose, with strategies including targeting high-prescribing doctors and downplaying addiction risks.

The workforce adjustments can be traced back to 2023, when the company eliminated 1,400 back-office staff. In 2024, McKinsey parted ways with 400 specialists who worked in areas such as data and software engineering. Reports have also emerged that the firm pressured underperforming staff to resign following a stringent mid-year performance review program in 2023, according to the Financial Times.

Before 2023, McKinsey saw an almost two-thirds increase in its employee count as it expanded its services beyond core advisory roles. This expansion encompassed larger-scale project implementation and business ventures that saw a boom in the consulting industry during the pandemic.

The widespread job cuts in the professional services industry continue, with PwC, one of the 'Big Four' firms, recently choosing to dismiss 1,500 of its US employees. Mid-level staff at McKinsey were reportedly offered financial incentives to leave their posts in 2023, including nine months' pay during their job search period.

McKinsey responded to the reports with a statement emphasizing the company's ongoing growth and the continued recruitment of thousands of new consultants in 2024. The company stated, "Our firm continues to grow and we're doing more impactful work, in more ways, than ever."

The financial industry is facing a downturn, affecting numerous businesses, including McKinsey, as they implement cost-cutting measures. This is evident in McKinsey's recent workforce reduction, which impacted approximately 10% of its staff. The company's actions follow a scaling back of expansion plans, linked to a diminished workforce from 45,000 to 40,000 over the past 18 months.

Read also:

    Latest