McKinsey Plots Thousands of Job Cuts in Slowdown for Consulting Industry (bloomberg.com)
- Reference: 0180398009
- News link: https://slashdot.org/story/25/12/16/1727251/mckinsey-plots-thousands-of-job-cuts-in-slowdown-for-consulting-industry
- Source link: https://www.bloomberg.com/news/articles/2025-12-15/mckinsey-executives-plot-job-cuts-in-slowdown-for-consulting-industry
The firm's leadership has discussed a roughly 10% headcount reduction in support functions, according to Bloomberg. McKinsey's revenue has hovered around $15 billion to $16 billion for the past five years after a decade of rapid expansion that saw employee count climb from 17,000 in 2012 to 45,000 by 2022. The headcount has since slid to about 40,000.
The cuts come as consulting firms face cost-conscious clients, Trump administration pressure on government consulting spending, and reduced payments from Saudi Arabia, which had been paying McKinsey at least $500 million annually in the decade up to 2024. McKinsey cut about 1,400 jobs in 2023 under a plan internally labeled Project Magnolia, and axed 200 global tech positions last month. The firm still plans to hire consultants even as it shrinks support staff.
[1] https://www.bloomberg.com/news/articles/2025-12-15/mckinsey-executives-plot-job-cuts-in-slowdown-for-consulting-industry
Good (Score:5, Interesting)
I've always detested what this company does. It is basically in the business of destroying value for consumers. What they do is identify areas where companies leave money on the table which is really value that consumers see and turn it into extra profit for the company. Allstate Insurance was one example of a company which was "McKinsey'd". They went in and identified all of the areas where value could be extracted from the product, and then turned it into profit, this caused the product to become less attractive to the consumer. I had Allstate insurance in the 80's but had to switch to another insurance carrier when they removed the value from their product. You might say that they were the selling enshittifcation as a service "EAAS".
Re:Good (Score:4, Interesting)
The stock market forces this. All public companies are stacked this way. If you are leaving money on the table, then you are hurting the share holder. Damn the quality or company reputation. It is a source of attack if you care about customers. Watch any company go public and you will see the erosion in a decade.
The stock market alone forces companies to despise their customers.
Re: (Score:2)
This means that the long term strategy would be to go under, because once you are no longer providing value, the consumers will look elsewhere. (That is unless you are operating a cartel)
Lack of long term term planning is the Achilles heel of "C" corporations. There is no mechanism to force them to consider long term objectives. You might say that this is against shareholder interests as well, but mist shareholders don't own the stock long enough for it to matter to them.
There is a different corporate struc
Re:Good (Score:4, Interesting)
I don't think that's true. It depends a lot on who the shareholders are and how many of them there are. Sometimes the corporation prefers quality and a good reputation for customer and employee relations. Sometimes they prefer those things until a hedge fund or private equity group buys a lot of shares and starts making demands. Sometimes they let someone like McKinsey come in and give them bad advice.
You don't hear many complaints about Publix Supermarkets doing these things. It's publicly traded, but employee owned.
Re: (Score:2)
That's really not true. There are many companies, such as Costco, that have tremendous stock returns and that also, by all accounts, treat their employees and customers very humanely and well.
MBAs = enshittification.
I encourage all kids and college students I speak with to start their own businesses. I've found more and more over the years that starting businesses (perhaps outside of food services) is just incredibly far from most people's minds. If you are a business owner you are going to have to put in a
Re: (Score:3)
They also helped move our manufacturing base to China. It's also a pipeline for corporate and political leaders.
And, despite there being no logical justification, evidence, or even fairness in the allegation, I'm going to go ahead and blame them for the 1929 crash as they were founded in 1926 and survived it.
Re: (Score:1)
AXA insurance, reporting in!
Trivial to replace (Score:3)
These people are overwhelmingly trivial to replace, a few slides and some self important babble is what AI thrives in producing.
The only thing that AI will have a hard time emulating is the filthy corrupt behind the scenes deals and general corruption that the big4 have cultivated as their only real tangible output and product.
Re:Trivial to replace (Score:5, Insightful)
In my experience it seems that consultants are often only hired to justify things that managers can't justify. Once they hire a consultant and the consultant tells them they should do the thing they want to do, they can do it with no further justification and blame the consultants when it all goes wrong.
AI should be pretty good at that.
Consultancy is a scam (*) (Score:2)
(*) Not all consultancy is a scam, just a lot of it.
What does a consultant actually do?
Let's be fair, if the consultancy is compacting the timeline, removing stress, strain, and providing workflow optimization, clarity, and good direction, well, keeping costs reasonably in check, I'm all for that, if your teams or company does not have the required knowledge or specialization.
On the other hand, how often do we have to hear about massive cost overruns? Not 5% or 10% cost overruns, 100%, 200%, 1000%?
Racing to the bottom as a joke? (Score:2)
Needs funny, but the best I can do is that every company includes some part or person who is least profitable and it seems easy and a "sure fire" path to higher profitability to cut off that part or person.
What could possibly go wrong? Until you get down to the last person?
McKinsey (Score:3)
The main real purpose of MBA consulting firms is to provide cover for senior management. When things go badly, you can say that you followed the best advice of the consultants and it is therefore not your fault that the company is going bankrupt.
Non Paywalled Version of Article (Score:2)
Here's a link to the article on another site which doesn't require a subscription. What do slashdot editors even do anymore? [1]https://www.insurancejournal.c... [insurancejournal.com]
[1] https://www.insurancejournal.com/news/national/2025/12/16/851200.htm
In related news... (Score:3)
...there are news reports of a massive spike in tiny violin sales.
McKinsey clueless.Trust or replace your management (Score:1)
McKinsey brought their wrecking ball through our company, they take a portion of the savings they introduce for their fees, so great incentive to cut, cut, cut. They were clueless as far as I could tell, Microsoft Copilot could have done it better. Really, the best people to dictate how you organise your departments is your own management team - outsiders can't offer better insights than you already have. If the board decide your management team are underperforming in structuring operations then they should
When you can get the same results from AI (Score:3)
Why bother to hire a consultant, who will most likely be using AI anyway?
Thousands of consultants GONE ! (Score:1)
And nothing of value was lost.
but surely as consultants (Score:2)
they should have been doing that ever year to improve the bottom line figure?
Re: (Score:2)
No, laying off employees makes the stock price go up. When Meta laid off employees, they kept the consultants. As a consultant, that always puzzled me. Under Washington state law, they have to give 60 days notice of any layoffs, but consultants can be walked out of the building by security guards with zero advance notice... which is why Meta has so many security guards.
Re: (Score:2)
Is that 60-days notice or just 60-days pay?
Re: (Score:2)
well then, I guess it depends does McKinsey employ employees or consultants?