Accenture, the Dublin-based professional services giant, has announced that it is planning to cut 19,000 jobs, equivalent to about 2.5% of its global workforce, as part of a cost-cutting exercise. This comes after the company lowered its annual forecast of sales and profits amid growing caution over the global economic situation, and is part of a wider trend in the consultancy sector for layoffs as corporate clients rein in projects.

Despite the job cuts, Accenture has confirmed that it remains committed to creating 3,000 tech jobs distributed across the UK, which it announced in late 2021. This is part of its plan to expand its employee numbers in the country.

The company has attributed the job losses to streamlining its operations and transforming its non-billable corporate functions to reduce costs. Accenture has said that the cuts will take place over the next 18 months, and more than half of the employees who will leave are working in non-billable corporate roles.

While Accenture has enjoyed strong growth over the past three years and launched a recruitment spree to meet the demand for tech advice from large companies, it has now reduced its projected annual revenue growth to between 8 and 10%, down from a previous forecast of up to 11%. It has also downgraded its profit guidance as net income fell 7% to $1.5bn in its second quarter, ending 28 February.

Ignacio Rasero, vice president-senior credit officer for Moody’s Investors Service, has stated that Accenture’s job cuts are a result of demand levelling out after the Covid period, and that the company’s diversified business and industry mix helps offset weakness in specific sectors, such as technology, and provides stability. Long-term demand prospects for Accenture’s services remain high as the company continues to benefit from digital transformation trends.