Deloitte is trimming costs again after a year of upheaval
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- Deloitte UK has had a year of reorganization and cost-cutting amid a consulting slowdown.
- It is planning to cut staff travel and expenses by 50% for the rest of the financial year, the FT reported.
- The cuts to spending were short-term, a senior exec said in internal messaging.
The Big Four consulting firm Deloitte wants to cut its spending on staff travel and expenses by more than 50% in the UK, where it is headquartered.
In an email sent to partners and directors in October, Deloitte said the "firmwide cost management measures" were being introduced because of "challenging market conditions" in the UK, the Financial Times reported.
Deloitte reportedly said it was only aiming to maintain the cost cuts until the end of its current financial year in May and described the reduction in spending as "limited" and "temporary."
The email was sent by Sarah Humphreys, chief operating officer of the tax and legal division. Humphreys said Deloitte was also reviewing its "recruitment agency costs, licence fees, bad debts and global recharges," the FT reported.
The cost-saving efforts come after a year of reorganization and redundancies at Deloitte, as the firm grapples with an industry-wide slowdown in demand for consulting services that has hit revenue growth.
Deloitte's global consulting revenues grew by 1.9% in the 2024 financial year ending 31 May. The previous year, they grew by 19.1%.
"Like many organisations, we are looking carefully at our costs to ensure we're able to meet clients' needs while continuing to make investments in our firm and our people," Deloitte said in a statement shared with Business Insider Monday.
The downturn comes after many consultancies hired aggressively during the pandemic.
In March, Deloitte carried out a global overhaul of its operations aimed at cutting costs and repositioning it for future success. It simplified its core offering from five to four categories: audit and assurance, tax and legal strategy, risk and transactions, and technology and transformation.
It has also held several rounds of layoffs in the UK, where it has around 25,000 employees. In internal messages seen by Business Insider, Deloitte said layoffs of around 180 staff in September were "necessary to enable us to navigate the remainder of a challenging FY25."
The firm has also cut UK partner's pay to save on costs, leaving the most senior class of employees with roughly £50,000 ($63,000) less than the previous year — a 4.5% decline. UK partners still took home an average of around £1 million ($1.2 million) for the fourth year running.
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