Deloitte, a London-based multinational professional services network, is laying off some employees in its U.S. consulting division because the federal government has asked the company to reduce the costs of its government projects, according to reports.
Deloitte Faces Workforce Reductions as Consulting Growth Slows
The firm has not disclosed the exact number of employees affected. A spokesperson said that small job cuts would take place in the coming weeks, depending on shifts in government clients' needs. Deloitte also noted that employee departures had recently decreased, which made workforce reductions necessary.
Despite these cuts, the demand for the company's advisory services remains strong, according to The Wall Street Journal.
Deloitte's U.S. management consulting business saw very little growth last year, increasing by less than 1% in 2024. This was a sharp drop compared to 17.8% growth in the previous year and 25.5% the year before that. By the end of 2024, Deloitte had nearly 173,000 employees in the U.S.
Deloitte and Other Firms Agree to Billions in Contract Cuts Under Government Pressure
Deloitte is one of the largest consulting firms working with the federal government. This week, several major consulting firms, including Deloitte, agreed to reduce billions of dollars from their contracts in response to a General Services Administration (GSA) deadline. The GSA required these firms to justify their contracts and propose cost reductions.
The GSA, an independent agency of the U.S. government established in 1949 to help manage and support the basic functioning of federal agencies, is already reviewing the cost-cutting proposals and is pushing for even bigger reductions, according to sources familiar with the process.
Advisory Slowdown Triggers Layoffs as Accounting Firms Face Lower Turnover
Accounting firms have seen fewer employees leaving on their own than expected after hiring large numbers of workers during the pandemic.
Many layoffs in these firms have been focused on advisory services, as revenue growth has slowed due to corporate clients cutting back on certain services. In 2023, Deloitte reduced its U.S. workforce by 1.5% due to these cuts.
Last month, Canada's Transport Minister Chrystia Freeland announced that the country will stop all rebate payments for Tesla and ban the company from future electric vehicle (EV) rebate programs.
Freeland noted that as long as the U.S. imposes the "illegitimate and illegal" tariffs against Canada, Tesla vehicles will not qualify for rebates.
