Redundancies at Large UK Accounting Firms

The 50 largest accounting firms in the United Kingdom have reduced their headcount by about 3,000, or 5 percent, over the past year, according to an annual survey from Accountancy Age.

The top 50 firms by revenue now employ 56,669 qualified accountants, the survey found.

“Experts expect the job cuts to continue as firms try to slash costs in response to a sharp slowdown in demand for corporate finance and other services,” Accountancy Age predicts.

Even KPMG, which last winter reduced UK staffers to a four-day work week to avoid layoffs was planning to cut 200 jobs.

Phil Shohet, director of Kato Consultancy, told Accountancy Age firms are cutting managers and recruiting graduates:

This has forced partners to "trade-down" and handle more technical work, Shohet said, meaning that clients are often relying on inexperienced graduates to help them survive the recession. "You need more rounded managers who are technically very good, but who can also manage staff better," he said. "In independent firms there is very little management training."

Here in the U.S., the Bureau of Labor Statistics reports CPA firms employed 438,600 people in April of 2009, down 4,800 people from April of 2008.

The BLS also offers seasonally-adjusted numbers for the broader accounting and bookkeeping industry. Those figures show 5,100 fewer people working in the field in May of 2009 than were working in May of 2008.

Anecdotally, our viewers continue to share the news about layoffs in many cities by accounting firms, including the Big 4, as they comment on our blog What's Behind Layoffs at the Big Four.