PricewaterhouseCoopers (PwC) is set to lay off approximately 1,800 employees in the United States, marking its first major round of layoffs since 2009. The job cuts, affecting about 2.5 per cent of the US workforce, span various roles, from associates to managing directors, and include business services, audit and tax. The cuts are primarily focused on the US advisory and products and technology operations, with about half of the affected employees based offshore.
The restructuring, which includes significant changes to its technology group, comes as the firm faces a slowdown in demand for parts of its advisory services.
PwC US leader Paul Griggs announced the restructuring and layoffs to staff in a memo, obtained by the Wall Street Journal, stating that the firm is “positioning our firm for the future, creating capacity to invest, and anticipating and reacting to the market opportunities of today and tomorrow.”
The announcement, made on September 11, also acknowledged the sombre anniversary of the firm's loss of five colleagues in the 2001 attacks.
This development marks a significant shift for PwC, which had avoided layoffs in the US since 2009, unlike its peers Ernst & Young (EY), Klynveld Peat Marwick Goerdeler (KPMG) and Deloitte.
The restructuring will see PwC's products and technology teams more deeply integrated into individual business lines. The changes come as part of a broader structural overhaul initiated by Paul Griggs, who took over as US leader in May.
Tim Grady, PwC's US chief operating officer (COO), said, “To remain competitive and position our business for the future, we are continuing to transform areas of our firm and are aligning our workforce to better support our strategy,” as per the WSJ report.
Meanwhile, PwC's China office is also facing a crisis after losing a major client, Country Garden Holdings. This loss comes amid scrutiny over PwC's role in auditing China Evergrande Group, which is accused of a $78 billion fraud, Reuters reported.
As a result, PwC China has implemented cost-cutting measures and layoffs. Reuters reported on September 5 that over 50 Chinese firms, including Bank of China, have dropped PwC as their auditor or scrapped plans to rehire it.
Country Garden cited PwC's failure to meet the deadline for publishing its audited 2023 financial statements as the reason for its decision.
