PwC in the US is set to make job cuts, affecting about 1,800 employees, representing around 2.5% of the workforce in its US division. This move marks the first formal layoffs for the company's US unit since 2009, as it aims to reorganize its technology group in response to a decrease in demand for certain advisory services. The offshore positions will bear half of the anticipated layoffs, impacting a broad spectrum of employees from lower-level associates to higher-ranking managing directors.
According to a report from the Wall Street Journal, departments like business services, audit, and tax are expected to bear the brunt of the reductions. Notifications regarding these job cuts are scheduled to be sent out in October. PwC's US leader, Paul Griggs, acknowledged the challenges of the situation, mentioning that this action will impact "a relatively small proportion of our people." The last time formal layoffs occurred within PwC's US unit was back in 2009.
Beyond the US restructuring, PwC is facing challenges in China after losing a client, Country Garden Holdings, amid scrutiny over its auditing involvement with the China Evergrande Group's $78 billion fraud accusations. Consequently, cost-cutting measures and layoffs have also taken place in PwC's China division. The company has experienced a crisis in China, with over 50 Chinese firms reportedly dropping PwC as their auditor, including Bank of China, PwC's largest mainland client. Country Garden cited PwC's failure to meet the deadline for publishing its audited 2023 financial statements as a reason for ending their association. Additionally, this move by PwC coincides with similar actions by its competitors - EY, KPMG, and Deloitte - who collectively laid off thousands of employees in the US over the past two years, partly due to the effects of the pandemic.