The big four firm announced on Monday afternoon that it would reduce partner and staff numbers by approximately 7 per cent of its over 10,000-strong workforce.
The job losses will happen across “most business units and internal client service departments”, with greater reductions in the consulting and advisory parts of the business.
It is understood that Deloitte’s external audit practice will be sheltered from the incoming redundancies.
Deloitte chief executive Richard Deutsch told partners and staff that while revenue for the financial year had grown by 10 per cent — the sixth consecutive year it has achieved double-digit growth — the firm had experienced a “significant decline” in its revenue base in the final quarter ended 31 May.
This included a 19 per cent year-on-year decline in revenue for the month of May, with the firm expecting the depressed revenue to carry over into the first quarter of the new financial year.
The job reductions come after Deloitte implemented a 20 per cent pay cut for staff and a minimum reduction between 20 and 25 per cent in earnings for partners in mid-April in response to the growing threat of the COVID-19 crisis.
Mr Deutsch laid the blame for the cuts squarely on the COVID-19 crisis, noting that the firm had strived to “preserve as many jobs as possible while also protecting the long-term sustainability of the firm”.
“Today, I have announced a second round of measures that includes a reduction in our workforce, actions that would not have occurred had it not been for the impact of COVID-19,” Mr Deutsch said.
“The health, safety and wellbeing of our people are central to our purpose and values as a firm, so this has not been an easy day.
“We are committed to work with our people that are leaving us in a way that shows genuine empathy and care for their situation.”
Job losses across the big four
However, at 7 per cent, Deloitte’s job cuts are now the largest across the big four, both in terms of percentage figures and absolute employee numbers.
Big four firm EY has yet to announce any redundancies. The firm had previously implemented a cut in work hours and pay from 1 May to 30 June.
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Jotham Lian is the editor of Accountants Daily, the leading source of breaking news, analysis and insight for Australian accounting professionals.
Before joining the team in 2017, Jotham wrote for a range of national mastheads including the Sydney Morning Herald, and Channel NewsAsia.