MicKinsey, the global consulting firm, has trimmed its workforce by about 10 per cent. The company had hired in big numbers during the pandemic and had over 45,000 employees by the end of 2023. Now, this number has been reduced to about 40,000 post job cuts spread over the past year and a half.
This is reportedly the largest downsizing exercise the consulting firm has ever undertaken. Why? Because it has been facing slow growth in terms of revenue post the boom it had witnessed during the COVID-19 pandemic. During that boom it had expanded its workforce by almost two-thirds. This workforce expansion could not be sustained when demand fell and voluntary attrition dropped to record lows.
As a corrective measure, McKinsey had undertaken a restructuring exercise in 2023, which led to 1,400 back-office jobs being cut. About 400 data specialists and software engineers were also eliminated. The company also tightened the performance reviews, which resulted in underperformers being eliminated.
To add to its woes, McKinsey had to cough up over a billion dollars to settle a suit involving American opioid manufacturers. In April of 2024, McKinsey UK had offered its senior staff career-coaching services along with up to nine months’ pay while extending a voluntary resignation offer.
With some of its competitors posting improved revenues, McKinsey is keen to get back on the track to sustained profitability as soon as possible.
