Accenture plans indicate 10,000 employees to be laid off in India

Professional services firm Accenture is set to lay off 5% of its global workforce in response to the Covid-19 induced economic crisis, which puts around 10,000 Indian jobs at risk.

The news was broken by the Australian Financial Review (AFR), which revealed that approximately 25,000 of the firm’s global base of half a million employees are likely to be “transitioned out” this year. With more than 200,000 employees, Accenture’s India operation is by far the firm’s largest global outfit, and might bear the brunt of the global staff cuts.

The plans were revealed by Accenture global CEO Julie Sweet at a global staff meeting earlier this month, following a dip in the firm’s growth rate from 8% in February to the current 1%. However, representatives from the firm informed IANS that the latest cuts are not far removed from Accenture’s annual process of evaluating employee performance.

“This year, across all parts of our business and all career levels, we will identify approximately 5 per cent of our people as our lowest performers, and these individuals will transition out of Accenture. This is consistent with our actions each year,” said the firm. That being said, Covid-19 and the consequent economic slump has squeezed revenues for many a business, particularly ones that rely on third party spending.

India’s thriving services sector was hard hit by the crisis, and leading digital consultancies have made significant staff cuts in recent months as a result. Cognizant, for instance, has already cut 11,000 jobs in the country, while other IT services firms have also been offloading by the thousands.

Although striving for business as usual, Sweet confirmed that Accenture was also taking special measures for this year, in that the outgoing 5% will not be replaced with a fresh batch. “Right now, we're not in a demand scenario, so if we manage out the same percentage of people and don't replace them, it allows us to continue to invest and preserve some people who have lower chargeability for when the market comes back,” she said.

That being said, she also indicated that an additional 5% of low performers had been identified for this year, in the case the firm needs to further cut costs at a later stage. Recruitment is frozen at Accenture, and the firm has cut ties with a cohort of sub contractors. However, the firm still needs to offload some of its staff to maintain growth and profitability.

While the new measures are bad news for many at Accenture India, the practice remains a crucial link in the firm’s global operation. To signal its continued importance, and its appreciation for those who have rallied at a tough time, Accenture has continued rewarding high performing employees with bonuses and promotions.