EY India has struck a bullish tone and ruled out job cuts in the wake of its US counterpart citing “overcapacity” and announcing the elimination of as many as 3,000 employees. The domestic arm of the Big 4 giant said its verticals are growing at a robust pace and that “there are no similar plans in India” as it looks to add to its existing workforce.
The cuts in the EY US region came after a global plan (code named ‘Project Everest’) to split EY’s consulting and auditing business and free both verticals from conflict of interest were aborted. The radical shakeup was dropped after it faced resistance from the firm’s US Executive Committee.
According to a report by the Guardian dated April 13, EY has reportedly told UK staff to brace for a wave of cuts, after the business spent $600m (£480m) globally preparing for the ambitious split of operations.
In response to an email query to EY India from Moneycontrol on the impact of the job cuts in the US and if a similar move would be considered in India, the firm said, “The announcement is specific to EY in the US market and there are no similar plans in India. We are looking forward to closing another strong growth year with robust growth across our service lines and increasing our people strength. We hired more than 18,000 people in the last 12 months and have more than 38,000 people across all member firms in India.”
It further added, “We expect to continue our growth trajectory and are thankful to all our people for their resilience and commitment to high-quality client service, and tremendous contributions to the success of our organization.”
Rajiv Memani is Chairman of EY India for nearly 19 years. According to his Linkedin profile, he is also a member of EY’s Global Executive Board and Chairman of EY’s Global Emerging Markets Committee.
According to an April 13 report by the Economic Times, many EY India partners were disappointed following the failed split attempt, “as the windfall they had been eagerly anticipating following the listing of the advisory business and settlement of the audit business would no longer materialize.”
While announcing the redundancies, which account for around 5 percent of the US staff, EY indicated the move was not a consequence of the failed global split.
“After assessing the impact of current economic conditions, strong employee retention rates, and overcapacity in parts of our firm, we have made the difficult business decision to separate approximately 3,000 US employees. These actions are part of the ongoing management of our business and not a result of the recently concluded strategic review, known as Project Everest,” an EY spokesperson said.
Other major consulting and accounting firms have also opted for downsizing in recent times.
McKinsey is planning to cut 2,000 jobs after hiring while KPMG too announced earlier this year that it will lay off 2 percent of its workforce – or about 700 employees – in the United States.
Also Read: McKinsey layoffs: Consulting giant to cut 2,000 jobs after mass hiring
Among the biggest companies that slashed jobs or froze hiring last year and this year are Meta, Twitter, Amazon, Google, and Microsoft in the face of sluggish consumer spending, higher interest rates, and surging inflation worldwide.
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