Global tech consultancy firm, Accenture, has announced plans to cut 19,000 jobs, around 2.5% of its workforce, and reduce its annual revenue and profit forecasts due to ongoing economic challenges. The majority of job cuts will be in non-billable corporate functions, with more than half of them occurring over the next 18 months. Accenture had previously increased its workforce by 38,000 in the financial year ending February 2023 due to increased demand for its services. The company’s revenue growth for the fiscal year 2023 is now expected to be between 8% and 10%, down from 8% to 11%. Other major companies, including consulting firms McKinsey & Company and Bain & Company, have also announced job cuts and reduced profit forecasts.
Accenture, one of the largest tech consultancy firms in the world, has announced its plans to cut 19,000 jobs, or 2.5% of its workforce, as well as reducing its annual revenue and profit forecasts. The move comes as the global economic climate continues to weaken and other major companies are trimming their expenses in response.
The company stated in a Securities and Exchange Commission (SEC) filing that more than half of the job cuts will affect non-billable corporate functions and will take place over the next 18 months. Accenture has increased its workforce by 38,000 in the financial year ended February 2023 to address the increased demand for its services and solutions.
According to Accenture’s SEC filing, attrition, excluding involuntary terminations, was 12% in the second quarter of fiscal 2023, down from 18% in the second quarter of fiscal 2022. The company evaluates voluntary attrition, adjusts levels of new hiring, and uses involuntary terminations to keep its supply of skills and resources balanced with changes in client demand.
Accenture now expects annual revenue growth for fiscal 2023 to be between 8% to 10%, down from 8% to 11%. The company noted in its filing that its results of operations are affected by economic conditions, including macroeconomic conditions, the overall inflationary environment, and levels of business confidence. Economic and geopolitical uncertainty in many markets around the world has impacted and may continue to impact Accenture’s business, particularly with regard to wage inflation and volatility in foreign currency exchange rates. In some cases, these conditions have slowed the pace and level of client spending.
The Dublin-headquartered firm is not alone in its decision to cut expenses in response to the challenging global economic climate. Other major companies have also announced job cuts and reduced profit forecasts. Companies that have announced similar measures include consulting firms McKinsey & Company and Bain & Company, as well as major financial institutions such as Citigroup, Goldman Sachs, and JPMorgan Chase.
In conclusion, Accenture’s decision to cut 19,000 jobs and lower its revenue and profit forecasts reflects the ongoing challenges faced by companies in the current global economic climate. As other major companies make similar decisions, it remains to be seen how the market will continue to respond and how long the economic challenges will persist.
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