Potara PricewaterhouseCoopers (PwC), one of the "Big Four" accounting firms, is set to lay off around 1,800 employees, marking its first major staff reduction in 15 years. The layoffs primarily affect the U.S. advisory, products, and technology divisions. This restructuring move comes amid slowing demand for advisory services, which has impacted the firm’s broader operations. Roughly 2.5% of PwC’s U.S. workforce will be affected, with about half of the job cuts involving offshore employees. PwC plans to notify those impacted by October 2024.
These layoffs are part of a broader realignment strategy aimed at enhancing the efficiency of PwC's technology and business operations. According to internal communications, the firm seeks to embed its technology teams into business lines to improve integration and streamline processes. Paul Griggs, the U.S. leader at PwC, expressed that the changes are challenging but necessary to align the firm with market realities. PwC's Chief Operating Officer, Tim Grady, emphasized the need to reposition talent to areas with higher demand to remain competitive in the evolving market.
Interestingly, PwC had avoided layoffs during the COVID-19 pandemic, making this decision stand out among its peers. In contrast, the other Big Four firms—Deloitte, Ernst & Young (EY), and KPMG—had already conducted layoffs, with thousands of U.S. employees affected over the last two years. PwC had positioned itself as an exception during that time, but the shifting economic environment and internal pressures have now forced it to reassess its workforce structure.
The job cuts come as PwC, along with other firms, faces heightened scrutiny from regulatory bodies. New quality control standards set by the U.S. Public Company Accounting Oversight Board (PCAOB) aim to enforce stricter oversight on accounting firms, especially those auditing public companies. These changes add additional pressure on PwC to enhance the quality of its services, with compliance and restructuring costs further weighing on its operational decisions.
Overall, the layoffs and restructuring at PwC reflect the broader challenges faced by professional services firms in adapting to fluctuating market demand, increased regulatory pressure, and the need for technological transformation.