Ernst & Young to Cut 3,000 Jobs Due To 'Overcapacity' and 'Current Economic Conditions'
The layoffs will impact nearly 5% of the accounting giant's workforce.
By Madeline Garfinkle •
Global consulting firm Ernst & Young (EY) said on Monday that it is cutting around 3,000 jobs in the U.S., impacting about 5% of its workforce.
According to multiple outlets, the company cited "overcapacity" and "the impact of current economic conditions" as contributing factors in the decision.
The job cuts come days after EY announced plans to overhaul its business by breaking up its auditing and consulting services. In September, the company announced intentions to split up divisions over regulatory conflicts of interest from the auditing and consulting arms of the business — a move dubbed "Project Everest."
However, early last week, the break-up plan was called off, per The Financial Times.
"We have been informed that the US executive committee has decided not to move forward with the design of Project Everest," the company wrote in the note, which was seen by the Financial Times. "Given the strategic importance of the US member firm to Project Everest, we are stopping work on the project."
As for the current layoffs, the company said the decision was unrelated to the review, but it was "part of the ongoing management of the business," per BBC.
EY is not the only consulting firm trimming its workforce. Last month, McKinsey & Co. announced it would be cutting nearly 19,000 jobs, and, in February, KPMG announced 700 job cuts, Bloomberg reported.
