KPMG on Wednesday said that it is laying off two per cent of its staff in the United States of America, making it the first of the four largest accounting firms in the world to do so, reported Financial Times citing an internal announcement.
The cuts at KPMG will affect close to 700 people, the FT report added.
Carl Carande, vice-chair of KPMG's US advisory business said that the decision was taken as the firm needed to "better align our workforce with current and anticipated demand in the market".
"We have experienced prolonged uncertainty affecting certain parts of our advisory business that drove outsized growth in recent years," KPMG said to FT.
"We have experienced prolonged uncertainty affecting certain parts of our advisory business that drove outsized growth in recent years," KPMG said to FT.
According to the report, like the other three of Big Four firms — EY, Deloitte, and PricewaterhouseCoopers (PwC) — KPMG has been struggling with the collapse in merger and acquisition activity. This led to an adverse impact on its deal advisory business and eased demand for IT and strategic consulting.
According to the report, KPMG had been attempting to reduce expenses by delaying the start date for new hiring, reducing travel expenditures, and shifting a number of consultancy workers to the audit and tax sides of the company.
"Our business and outlook remain strong. However, we have experienced prolonged uncertainty affecting certain parts of our Advisory business that drove outsized growth in recent years," a spokesperson for KPMG said in an emailed statement to Reuters.
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Prio to KPMG, several financial firms have slashed jobs in the recent months including Wall Street banks. Experts say the turbulent economic environment has been behind the job cuts.
