Biggest Layoff Yet: McKinsey to Cut 2,000 Jobs, Shocks Business Community

- Bloomberg News

Reuters, February 21st, 2007 - According to a story that was published on Tuesday by Bloomberg News, the powerful consulting firm McKinsey & Co. intends to lay off approximately 2,000 employees in one of the largest rounds of layoffs it has ever conducted.

The source claims that the company, which is well-known for advising businesses on a number of responsibilities such as layoffs, will most likely concentrate on support staff members who do not have direct contact with customers. "We are rethinking the way our non-client-serving teams function so that these teams may successfully support and scale alongside our firm," a company spokesperson said in an email to Reuters. This is the first time in more than a decade that this process has been undertaken. Bloomberg reports that the layoffs occurred as a direct result of Project Magnolia, an initiative undertaken by the consulting business with the goal of assisting in the protection of its partners' pay pool. In addition, it has been said that McKinsey intends to reorganize the way that its support teams are structured in order to combine some of the responsibilities.

This week, it was reported by the Financial Times that KPMG was planning to lay off approximately 2% of its US workers. This would make KPMG the first of the world's top four accounting companies to take such a step.