EY UK Expands Redundancy Program, Cutting 150 Additional Jobs Amid Market Slowdown
EY in the UK is intensifying its redundancy initiatives, announcing an additional reduction of 150 jobs, highlighting the challenges faced by major firms in the wake of declining demand for specific services.
As reported by the Financial Times, EY has launched ten redundancy consultations in response to a market slowdown, doubling the total redundancies for the year to 300.
The workforce reductions are anticipated to impact various sectors within the organization, including the legal arm and the strategy and transactions advisory business, EY-Parthenon.
This streamlining effort includes the closure of EY Riverview Law, the legal services firm acquired in 2018, leading to significant layoffs.
These decisions come amid challenges faced by the Big Four—Deloitte, EY, KPMG, and PwC—as they navigate increased expenses and decreased demand in a challenging economic environment.
Previously, EY had announced around 150 job cuts in its financial services consulting arm, with indications of more moderate salary increases across the organization.
The redundancy program is now extending to multiple business segments, particularly areas like transactions and deal advisory, which are expected to face ongoing challenges through 2024.
In April, after abandoning Project Everest, a global initiative to separate the audit and consulting divisions, EY's UK partners were advised to brace for cost-saving measures.
Approximately 40 positions are projected to be eliminated at EY-Parthenon, and EY Riverview Law anticipates around 55 job cuts as part of the recent redundancy consultations.
Compared to the US business, where 3,000 positions—equivalent to 5% of the workforce—were slated for elimination earlier this year, the impact of redundancies in EY's UK sector appears less severe. The UK branch employs about 21,000 individuals.
During the most recent financial year, EY's UK partners experienced a 5% decrease in average earnings, taking home an average of £761,000.
EY responded to the developments, stating, "We continuously evaluate our business's resource needs and, in certain areas, are proposing adjustments to align our current resources with market demand.
We prioritize the redeployment of our employees to other parts of the business whenever feasible."
EY's acquisition of Riverview was part of its strategy to strengthen the firm's legal managed services division.
Cornelius Grossmann, the firm's former global law leader, highlighted Riverview Law's expertise in a burgeoning market sector, foreseeing opportunities for EY's clients through the synergy of Riverview Law's strengths with EY's global reach and legal expertise.