KPMG, one of the world's largest auditing firms, is set to lay off an additional 2,000 employees in the United States.
This comes after the company had already fired 700 employees earlier this year due to the economic downturn caused by the COVID-19 pandemic.
The move is part of the company's plan to restructure its business and cut costs.
KPMG, which had already cut about 2% of its U.S. workforce (about 700 employees) in February, was the first of the world's four biggest accountancy firms to slash jobs in the country
"We do not take this decision lightly. However, we believe it is in the best long-term interest of our firm and will position us for continued success into the future."
KPMG had over 39,000 employees in the U.S. at the end of its last fiscal year on September 30, as per Reuters. KPMG's layoff announcement comes after many big tech giants, such as Microsoft, Google, Intel, HP, Dell, etc have already announced mass layoffs this year.
Impact on Employees
The news of the layoffs is a major blow to the affected employees and their families. Many of these employees have dedicated years of their lives to the company and are now facing uncertain futures.
The job market is tough right now, and finding a new job in the current economic climate will be challenging. KPMG has pledged to provide support to the affected employees, but it remains to be seen how much help they will actually receive.
Several companies have trimmed their headcount as a preventive step in anticipation of a potential economic downturn later in the year. Already, the entire Eurozone has fallen into recession.
Earlier this year in April, Ernst & Young's U.S. division shed 5% of its workforce. Deloitte had also reported having slashed jobs. Besides KPMG, EY, Deloitte and PricewaterhouseCoopers (PwC) make up the Big Four of accounting firms.
Impact on the Audit Industry
The layoffs at KPMG have wider implications for the audit industry as a whole. The COVID-19 pandemic has had a significant impact on the global economy, leading to reduced demand for audits.
Companies are cutting costs wherever possible, and many are questioning the value of audits altogether. This has put pressure on auditing firms like KPMG to adapt to the changing market conditions and find new ways to remain competitive.
In response to the layoffs, KPMG has stated that it is committed to ensuring the long-term stability of the company. The layoffs are part of a broader cost-cutting strategy aimed at streamlining the business and improving efficiency.
The company is investing in new technologies and innovative solutions to better serve its clients and stay ahead of the competition.
KPMG's fresh round of layoffs was first reported by the Financial Times.
The news of KPMG's layoffs is a stark reminder of the ongoing economic challenges facing many industries. The audit industry is no exception, and companies like KPMG are having to adapt in order to survive.
While the layoffs are undoubtedly a difficult development for the affected employees, KPMG's efforts to streamline its business and invest in new technologies could ultimately be beneficial for the company in the long term.