(Credit: Ricochet64 - stock.adobe.com)

Around 440 assistant manager roles in the audit business are at risk, out of a total of 590 positions identified for potential redundancy within the division. The advisory arm faces a separate cull of approximately 120 roles, with hundreds more under consideration. The bulk of those losses will fall on the enterprise risk department, which advises clients on governance, risk and compliance, though back-office staff and an economics team will also be affected.

The firm attributed the audit cuts to unusually low attrition rates. “Current market conditions mean our attrition rates are very low within certain parts of our audit population, which is why we are proposing to right-size those areas,” KPMG said in a statement. Compounding the problem, some foreign employees holding KPMG-sponsored visas have been unable to find alternative sponsored work elsewhere, further swelling the ranks of junior auditors, Financial Times reports.

On the advisory side, senior leaders are said to be concerned about meeting budgets after a prolonged slowdown. Consultants have been left without project assignments for months, and a number of recurring client engagements have been lost. “Last week was pretty devastating for everyone,” said one person familiar with the cuts, noting that some colleagues had endured similar disruption just a year earlier.

The redundancies highlight the continued strain on professional services firms even after successive rounds of cost-cutting. Demand for consulting has yet to recover to pandemic-era peaks, and firms are simultaneously having to adapt their operations and service offerings for an AI-driven environment. The UK consulting market grew by less than 4% last year, though the industry body Management Consultancies Association forecasts an improvement to around 6% in 2026. KPMG’s advisory business shrank by 3% over the same period, in line with revenue declines seen across the consulting arms of EY, PwC, and Deloitte.

The audit job losses are notable in that redundancies at the Big Four have typically spared that division, given the relatively stable nature of audit work. PwC cut 175 junior auditors last year, but large-scale audit culls remain unusual.

Despite the headcount pressure, KPMG’s overall financial performance has been robust. The firm reported a 14% rise in profit before tax to £576 million last year, driven by what it described as “careful cost management in response to the economic cycle.” UK partners were paid an average of £880,000 for the year to September – up 11% and ahead of rivals at PwC and EY for the first time in more than a decade. UK chief executive Jonathan Holt, who recently missed out on the firm’s global leadership role, has driven profitability by freezing pay and promotions, reducing headcount, and cutting the number of equity partners to the lowest level in twenty years.

KPMG employs around 16,700 people in the UK. Consultation on the audit redundancies is expected to run until mid-May.