July promotions still on track

The 329 job losses will come from all three divisions but mainly from reducing the number of duplicated support positions and from the firm’s consulting arm. PwC also said up to 37 partners will be forced into early retirement over the next nine months.

The affected staff will be informed over the coming days and, where possible, provided the opportunity to apply for any new roles created by the restructure.

This new round of staff cuts comes after the firm cut roughly 350 staff last year amid its tax leaks scandal and about 250 during COVID-19. The largest recent cut by a big four consulting firm was made by Deloitte during the pandemic, when the firm cut 700 staff.

Despite the grim news, PwC is still scheduled to admit new partners into its ranks in July, after pausing all such promotions since mid-2023. The firm will also carry out a round of mid-year staff promotions and is committed to bringing on its most recent graduate hires.

The firm has also been buoyed by its February financial results and continues to plough funds into high-demand advisory areas such as cloud, digital, risk and regulation.

The restructure comes as the firm’s leaders are working through a cultural overhaul and new ways of rewarding personnel. The firm’s leaders will soon run a series of internal roadshows to outline the new strategy.

‘Difficult day’

“This has been a very challenging and complex process, but an important one, as we realign our business structure with our new long-term strategy,” PwC Australia chief executive Kevin Burrowes said in a statement.

“I’m extremely proud of the contribution every individual at PwC Australia makes to this firm and their ongoing commitment to producing exceptional results for our clients.

“We acknowledge that days like today are especially difficult for those affected, as well as their teams and colleagues. I can assure you that we will work closely with impacted individuals to ensure they are aware of their options and next steps.

He said the reorganisation would make the firm more “simplified, efficient and centre-led.”

The broader consulting market has been hit by a reduction in private sector demand due to the slowdown in M&A activity and companies reducing their spending on external advisory services. Industry insiders who had originally hoped that the private sector market would pick up by Easter are now not expecting an uptick until August at the earliest.

$100m in cuts

At the same time, the public sector market for advisory services has also suffered a downturn due to the political fallout of the PwC leaks matter and a federal government push to reduce the use of consultants and contractors.

PwC is not directly affected by the public sector demand slowdown as it no longer supplies services to the sector after selling its government consulting business to Allegro Funds for just $1 last year.

The firesale was made after PwC was cut off from winning new Commonwealth work when the extent of the tax leaks scandal was revealed. Allegro created a new firm called Scyne to target government work comprising about 100 former PwC partners and about 1200 former staff.

The Australian Financial Review has been told that PwC is attempting to cut $100 million in ongoing costs from the firm’s operations. That indicates that Project Maple, which is examining every area of the firm’s operations, will also involve other sweeping cost-cutting measures and leaves open the possibility of further job cuts at a later stage.