Accenture to lay off 19,000 to cut costs amid economic uncertainty

IT services and consultancy firm Accenture said it would lay off 19,000 staffers, or 2.5% of its workforce,  over the next 18 months to reduce costs amid uncertain macroeconomic conditions.

“While we continue to hire, especially to support our strategic growth priorities, during the second quarter of fiscal 2023, we initiated actions to streamline our operations and transform our non-billable corporate functions to reduce costs,” the company said in an Securities & Exchange Commission (SEC) filing on Thursday.

“Over the next 18 months, these actions are expected to result in the departure of approximately 19,000 people (or 2.5% of our current workforce), and we expect over half of these departures will consist of people in our non-billable corporate functions,” the company added.

The job cuts reflect stabilizing demand, following explosive post-pandemic growth, and prudent cost management, according to Ignacio Rasero, vice president for Moody’s Investors Service.

In addition, the company has revised its fiscal year 2023 revenue growth.

“Accenture expects revenues for the third quarter of fiscal 2023 to be in the range of $16.1 billion to $16.7 billion, an increase of 3% to 7% in local currency, reflecting the company’s assumption of an approximately negative 3.5% foreign-exchange impact compared with the third quarter of fiscal 2022,” the company said in a statement.

Despite the reduced forecast, Accenture’s diversified business and industry mix can help offset weakness in specific sectors, such as technology, and provide stability, Rasero said, adding that long-term demand prospects for Accenture’s services remain high as the company continues to benefit from digital transformation trends.

Accenture’s decision to cut jobs comes just after Amazon decided to fire another 9,000 more workers from several business units, including AWS, at the beginning of the week.

Earlier this month, Meta announced that it would fire 10,000 employees, over and above the 11,000 job cuts that it announced four months ago. 

Uncertain macroeconomic conditions have forced technology companies to announce massive layoffs since 2022 through 2023.

IT Consulting Services, Technology Industry