PwC's decision to delay promotions in its graduate scheme, affecting around 100 graduates, is a response to reduced client demand and the aftermath of the Great Resignation. This move reflects broader challenges in the consulting industry.
In response to a persistent slowdown in client demand, PwC has made the decision to delay promotions in its graduate program.
The move comes as the consulting industry faces the challenges of readjusting from the hiring boom experienced during the Covid-19 pandemic.
The extended graduate program is expected to provide additional support and training for early-career professionals during a period of decreased workload at the senior associate level.
PwC’s decision to delay promotions in its graduate program reflects the broader cost-cutting efforts and headcount pressures faced by major consulting firms.
The “Big Four” consulting powerhouses, including EY, KPMG, PwC, and Deloitte, have all announced layoffs in the UK over the past year.
These layoffs are a direct response to the cooling business environment and the need to align their workforce with demand.
Last week, PwC informed approximately 100 graduates that their promotions, originally scheduled for July, would be delayed by an additional six months. Instead of being promoted, these graduates will continue their participation in the graduate program until January of the following year.
The decision is a result of sluggish demand for consulting services and the need to manage headcount in line with business requirements.
Typically, a promotion within the graduate program signifies a change in title and an increase in pay. However, due to the current circumstances, PwC has chosen to extend the program to provide ongoing support and training for its graduates.
This delay affects those who joined PwC’s consulting division in the fall of 2022, specifically those who joined in October and November. Graduates who joined a month earlier, in September, remain eligible for promotion in July.
A representative from PwC acknowledged that the delay in promotion may be disappointing for those affected but emphasized the firm’s commitment to balancing business demand with the long-term support of their graduates.
PwC has recruited over 3,500 graduates and school leavers since September 2022, with the delay in promotions impacting 90 graduates within the consulting practice.
PwC’s decision to delay promotions is just one example of the broader challenges faced by the consulting industry.
The industry experienced a significant talent exodus during the peak of the COVID-19 pandemic, known as the “Great Resignation.” However, the situation has since reversed, with firms now grappling with rising costs and declining demand for their services.
In 2023, professional services, including consulting, were among the largest recruiters of new graduates in the UK. However, the industry’s behemoths have been forced to freeze pay and cut jobs in response to the changing dynamics of the consulting landscape.
Unlike a few years ago, when many employees were leaving in search of better pay and working conditions, individuals are now holding onto their jobs, leading to fewer job openings within the industry.
PwC UK’s partners experienced a decrease in average pay, with partners earning £906,000 ($1.14 million) on average in the year leading up to June.
This figure represents a decline from the previous year’s average of £1.03 million. Despite these challenges, PwC’s annual report highlighted a 30% growth in their consulting practice, driven by high demand from oil and energy projects in the Middle East.
Looking ahead, the consulting industry will need to navigate the changing landscape and adapt to evolving client demands. By extending the graduate program and delaying promotions, PwC is taking proactive steps to manage its workforce and provide ongoing support to its early-career professionals.
