There’s no profession more conflicted about employee retention versus alumni relations than the auditors. On the one hand, the largest audit firms have well-oiled recruiting machines.
Their uncanny ability to identify and sway candidates early is rivaled only by professional baseball’s success at finding talented Dominicans still swinging stalks of sugar cane instead of bats. The firms spend millions of hours and dollars to compete for the top graduates. They love to see their names on lists of top places to intern and to start your career.
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This story is republished from CFOZone, where you’ll find news, analysis and professional networking tools for finance executives.
This is not the news you hear when there is talk of “recovery.”
Plus, it’s bad news for President Obama. The morning after our leader joined the rest of Americans and finally acknowledged that jobs are the most important issue facing the country, chief financial officers signaled they don’t expect the employment picture to improve anytime soon.
Sure, 62 percent of the 371 corporate CFOs who participated in the latest quarterly survey conducted by Financial Executives International (FEI) and Baruch College’s Zicklin School of Business said they do not plan any layoffs for this year. Big deal. Most companies have already gotten around to this cost-cutting measure. In fact, 77 percent of those surveyed said they already cut rank and file during the economic downturn.
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We stumbled across the playback of the all-personnel call that went out to Grant Thornton professionals last Friday and we decided to give it a listen. It was about as snoozerific as we expected but we did come away with some additional information to share with you
Stephen Chipman, GT’s new CEO in the States spent about 40 minutes explaining the good the bad and the ugly at G to the T and here are some highlights:
• 81% of those survey and Grant Thornton are proud to work there. High? Low? Completely made up? Does this consider the Sue Sachdeva effect?
• Chip is going to be focusing on various new forms of communication including his own blog. This makes him the second CEO to do so, following Newman over at BDO. We hope, for your sake, that Chip won’t moderate the comments. We insist that you notify us of this as soon as it goes live.
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We have some additional details to share with you to supplement last Friday’s post on E&Y’s New Year layoffs.
While we were surprised at the timing, a source has indicated to us that IT Risk and Assurance layoffs have occurred at the firm each January since 2008. This is due to a serious drop off in utilization in the new year after high utilization in the fall months with the exception of especially in the audit heavy ITRA practices.
In regards to the audit practice, we spoke to another source over the weekend that told us that layoffs would not occur until after busy season but assured us that they are being planned.
Finally, in response to one comment asking about severance details, we were informed that the severance for those let go is a week’s pay for each year of service with a minimum of 4 weeks pay. This seems to be fairly standard (with a few variations) amongst the Big 4.
We’ve received word on some positions cut but we’re still awaiting further details so if you have any information or can provide more insight discuss below or get in touch and we’ll update them here.
UPDATE: A source has indicated that three IT Advisory managers in FSO in New York were included in the cuts.
We’ve confirmed that an all-personnel call went out at Grant Thornton today warning everyone at the firm about upcoming layoffs.
One of our sources told us that the audit practice leader stated that it would primarily be cuts at the senior manager and partner level and that they are to take place “immediately”. Our source indicated that non-client serving personnel would also be affected.
Another source told us that there would be restructuring at the partner level which could be coming down from the new senior leadership team that the firm announced yesterday.
We are still trying to obtain details about the timing and number of professionals that may be affected. A Grant Thornton spokesperson has yet to return our email seeking comment. If you’ve got more details to share about the call discuss below or if you prefer to send us the details, get in touch.
Earlier coverage of Grant Thornton Layoffs:
Layoff Watch ‘09: Grant Thornton December Edition
Layoff Watch ‘09: Grant Thornton Update
Layoff Watch ‘09: Grant Thornton
Confused doesn’t even begin to describe what were feeling. We are hearing tons of rumors about layoffs in the Ernstiverse this week.
We’ve heard rumors from Denver to the East-Central (fka North-Central) and New York FSO. This includes both client serving professionals and support staff. We have already confirmed that two admins were let go earlier this week in New York.
The timing is especially strange since, you know, it’s January and in some offices the mandatory hours have already rolled out. Even if it were only support staff being let go, the timing is still unheard of. Why wait until January to let people go when having cuts in November? Maybe it’s just us but if we had survived that November cut, we would have thought that our job would be safe until at least the spring.
And since the roundtables seem to be SOP you wouldn’t think they would be anything to worry about but they definitely have people talking and wondering what will go down.
So far, Ernst & Young has not responded to our request for comment.
If you hear anything about your office get in touch in with us and discuss in the comments.
There was some quiet chatter here at GC about Ernst & Young’s closure of its Greensboro, NC office this past December, right around the Merry Happy holidays. Thanks Ernie.
This is nothing new. Smaller offices have been getting shut down for years. Years. Years.
You’ll probably find this to be a shocker but your feelings are not the main problem facing the firms due to the combination of recent closings and endless rounds of cuts. The problem is – it’s the theme of any busy season – firms finding themselves short staffed.
Many readers have commented that engagements are understaffed heading into the cold winter months. Albeit this is typically the unofficial “norm,” but slashed fees are only compounding the problem this year. The troubles of ‘09 will be used as firm scapegoats for 2010. Move along, kids. Nothing more to see here.
Serious trouble is brewing for at least one Big 4 firm, however. A source confirmed that their Big 4 Beast is outsourcing work in the Carolinas to smaller regional firms because they are so understaffed:
The combination of layoffs a year ago and people leaving now that the market is turning around is causing the firm to hire outside help just to get through busy season.
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Last month we had a couple of posts on the year that was in Crowe Horwath layoffs. After learning about three rounds of layoffs and a CH exodus, we figured we had exhausted the details on 2009 for Crowe.
Not so! The latest on CH is that, like everyone else, the firm is gearing up for busy season desperately shortstaffed despite the end of their “Alternative Staffing Program”.
We’ve also learned that there were pay freezes across the board at CH last year. This included a couple of instances where newly promoted managers had their pay frozen despite being told “substantial changes in duties would be exempt from pay freeze.”
Right now our sources aren’t sure what to expect from CH in 2010 as communication from their leadership has been minimal. So all in all, it doesn’t sound like Crowe is all that different from the Big 4 despite claiming to be “a unique alternative” to them. Good luck to all the professionals at the firm in 2010 and keep us updated with all the happenings during your busy season.
Earlier this month we told you about layoffs that went down at Crowe Horwath in late November.
We’ve now received additional details that indicate that Crowe has had several rounds of layoffs this past year that started with non-client serving personnel late in 2008 and culminating with the November round.
Our source told us that the second round occurred in spring of this year and at that time, firm leadership communicated that no further layoffs would be necessary. Apparently things didn’t goes as plan as a third round occurred in July that consisted of professionals in the risk consulting practice and many in the Financial Institutions practice that were not chargeable were asked to take sabbaticals. This report of “sabbaticals” is consistent with our report earlier from a source that indicated that “there was a lot of forced time off during the summer.”
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We come with news this afternoon about more layoffs at G to the T that are rumored to have gone down earlier this month.
This latest information we have involves two managers and two senior managers in the Los Angeles office were shown the door around the first of the month. Our source has indicated that the breakdown was three in the audit practice and one in tax. These latest cuts would be in addition to the original ten that we reported on last month for LA.
If you have more information on these layoffs or have details on a different GT office, get in touch with us or discuss in the comments.
Earlier: Layoff Watch ‘09: Grant Thornton
