EY announced on August 31 that it is investing $100 million in a new employee rewards program designed to recognize workers who embrace technology, innovate, demonstrate leadership and develop what the firm calls “future-focused skills.”

On paper, $100 million sounds impressive.

In practice, the announcement may land very differently with EY employees who just went through another compensation cycle marked by relatively modest raises, restrained bonuses and continued concerns about layoffs.

And there is another reason employees should look critically at the announcement:

This is not just an employee compensation program. It is also an extremely effective marketing campaign for EY’s AI consulting capabilities.

For many employees, the obvious question remains:

If EY has $100 million available to reward its people, why not simply pay its people better?

What Is EY’s New $100 Million Bonus Program?

EY says the new program will reward employees across three categories:

• Everyday leadership and contributions
• Transformations producing measurable results
• “Game-changing” contributions with a significant impact on the firm

The program also includes recognition for employees who effectively adopt and use advanced technology.

EY Americas CEO and U.S. Managing Partner Dante D’Egidio described the initiative as an investment in building a workforce capable of succeeding in a rapidly changing profession.

EY says the broader goal is to develop employees who can operate in what it calls a “tech-led, human-powered world.”

Reporting on the program indicates that some awards could be as small as $500, while larger individual or team awards may reach roughly $10,000 to $25,000.

There is nothing inherently wrong with rewarding innovation.

The problem is the context in which EY is announcing it.

EY Employees Just Went Through Another Underwhelming Compensation Cycle

EY’s FY27 compensation numbers began circulating among employees at the end of July.

The results varied significantly depending on service line, location, rating and promotion status. Employees receiving promotions or top performance ratings sometimes received respectable double-digit increases.

For employees simply progressing normally, however, the numbers frequently looked much less exciting.

Self-reported FY27 compensation data included examples of experienced Managers and Senior Managers receiving raises in roughly the 2% to 4% range, while some non-promoted employees reported mid-single-digit increases.

One employee reported going from $83,000 to $84,245 — an increase of only about 1.5%.

Another newly promoted audit Manager in Chicago reported moving from $104,000 to $113,800 and still believed the salary substantially lagged the market.

These figures are self-reported and therefore should not be treated as representative of every EY employee, but the annual EY compensation discussions show considerable dissatisfaction with the latest cycle.

That makes the timing of a flashy $100 million reward announcement questionable.

A 2% or 3% Raise Is a Much Bigger Deal Than a Chance at a $500 Award

The fundamental problem with programs like this is that guaranteed base compensation and discretionary awards are not economically equivalent.

Consider an employee earning $150,000.

A permanent additional 3% salary increase is worth:

$4,500 every year.

That higher salary can also affect future percentage raises, retirement contributions and potentially other compensation calculations.

Compare that with the possibility that the same employee might receive a $500 recognition payment for demonstrating the right behavior.

There is no comparison.

Workers generally do not need another corporate recognition system.

They need competitive base salaries.

Then There Are the Layoffs

The announcement becomes even harder to celebrate when viewed against EY’s recent workforce reductions.

Big Four employees have spent the past several years watching firms simultaneously talk about talent investment while reducing headcount, restructuring teams, expanding offshore delivery models and pushing aggressively into automation.

Employee discussions during 2026 contained repeated reports of layoffs at EY, including discussion of additional reductions during the summer.

Because EY does not publicly disclose every individual workforce reduction, those reports should be viewed carefully rather than treated as a complete firmwide layoff count.

But from the employee perspective, that technical distinction hardly eliminates the underlying concern.

Imagine watching colleagues leave the firm — or worrying whether your own position will survive the next restructuring — and then being told that the organization has found $100 million to reward people for adapting to disruption.

It creates a strange message:

We are disrupting your workforce, but we might give you a bonus if you demonstrate that you’re particularly good at adapting to the disruption.

AI Makes the Message Even More Complicated

EY is investing heavily in artificial intelligence.

The firm has reorganized offerings around AI-enabled “Integrated Solutions” and describes AI as fundamental to how professional services will be delivered going forward.

That strategy makes sense.

Every major professional-services firm should be investing aggressively in AI.

But employees have legitimate reasons to wonder who ultimately receives the economic benefit of those productivity gains.

Suppose AI eventually allows an engagement that previously required ten professionals to be performed by six.

There are several ways the resulting efficiency could be distributed.

Clients could receive lower fees.

Partners could receive higher profits.

Four positions could disappear.

Or some of the productivity gain could flow back to the remaining employees through materially higher compensation.

Employees will naturally become skeptical if the model increasingly appears to be:

fewer people + more technology + similar workloads + modest raises.

A discretionary AI-related recognition program does not solve that problem.

Is This Really an Employee Bonus Announcement — or an AI Marketing Campaign?

This is where the announcement becomes particularly interesting.

EY’s $100 million rewards initiative is not simply an internal HR program.

It also functions as advertising.

Look at the language EY uses.

The firm does not simply say it is giving employees more money.

Instead, the announcement repeatedly connects the program to technology adoption, innovation, disruption, transformation and building a workforce capable of operating in a “tech-led, human-powered world.”

EY says the program will recognize professionals who use advanced technologies to create results and turn disruption into opportunity.

That language may be directed toward employees, but it is also precisely the kind of language EY wants prospective consulting clients to hear.

A company deciding whether to hire EY for an AI transformation project is being presented with a useful narrative:

EY does not just advise companies about AI. EY is transforming its own workforce around AI.

That is valuable marketing.

Look at What EY Was Promoting Immediately Before the Bonus Announcement

The timing makes the connection even more noticeable.

Just days before unveiling the $100 million employee rewards initiative, EY announced its new Integrated Solutions strategy.

That initiative positioned EY’s service offerings around artificial intelligence, proprietary data, technology platforms and enterprise transformation.

Put those announcements together and a clear branding narrative emerges:

EY understands AI.

EY is reorganizing its own business around AI.

EY is training and rewarding employees for using AI.

Therefore, EY is well positioned to help clients do the same thing.

The employee bonus announcement becomes evidence supporting EY’s consulting sales pitch.

That does not mean the employee program is fake.

It means the program potentially serves more than one purpose.

EY can reward employees while simultaneously generating publicity demonstrating that the firm is serious about AI transformation.

The Media Coverage Is Part of the Story

The announcement did not remain buried in an internal email.

It generated widespread business and mainstream media attention.

Coverage appeared in outlets including:

• The Wall Street Journal
• Bloomberg Law
• CBS News / MoneyWatch
• Fortune
• People
• Yahoo Finance / Quartz
• Inc.
• PR Newswire
• EY’s own U.S. newsroom and corporate channels

That is a remarkable amount of attention for what is essentially an internal employee incentive program.

And the resulting headlines repeatedly reinforce exactly the brand positioning EY wants associated with itself:

AI.

Innovation.

Human judgment.

Transformation.

Future-ready workers.

Whether EY explicitly intended every individual article to become marketing is beside the point.

The practical result is the same.

A compensation program for employees becomes national advertising for EY’s expertise in the AI economy.

The $100 Million Number Is Perfect for Headlines

There is also a reason $100 million leads the announcement.

It is a fantastic headline.

Consider the difference between these two statements:

EY modifies its employee recognition program.

and:

EY invests $100 million in employees for the AI era.

One of those might generate a paragraph in an accounting trade publication.

The other can generate coverage in The Wall Street Journal, Fortune, Bloomberg and CBS.

The $100 million figure creates the impression of an enormous workforce investment.

But the economics experienced by an individual employee can look considerably different.

If some employees receive awards of only $500 while larger awards go to a smaller number of individuals or teams, there is an enormous difference between the headline:

“EY invests $100 million in its people.”

and the employee experience:

“I may receive a $500 award.”

EY nevertheless receives the benefit of having the entire $100 million figure associated with its brand.

From a marketing perspective, that is a pretty good return.

In a Strange Way, Compensation Spending Becomes Marketing Spending

This may be the most interesting part of the entire program.

Ordinarily, if EY simply increased everyone’s salary, the money would largely accomplish one thing:

Pay employees more.

That is important, but it doesn’t necessarily generate media coverage.

By structuring part of the investment around innovation, AI, leadership and future-focused skills, EY gets much more out of the same pool of money.

The firm gets:

• an employee incentive program,
• a recruiting message,
• an employer-branding campaign,
• an AI transformation case study,
• a client-facing demonstration of its AI capabilities,
• and widespread media attention.

In other words, some of this $100 million potentially doubles as business-development and brand-building spending.

That is considerably more useful to EY than simply increasing salaries.

The question employees may reasonably ask is whether that makes it better for them.

Employees May Be One Audience — But Clients Are Another

Professional-services firms constantly need to convince executives that they understand the next major business transformation.

A decade ago, it might have been cloud migration.

Then came digital transformation.

Now it is artificial intelligence.

Every Big Four firm wants CEOs, CFOs and boards to believe it has the expertise necessary to guide companies through that transition.

One of the easiest ways to establish credibility is to present your own organization as the case study.

EY can now tell prospective clients:

• We are investing billions in technology and talent.
• We are redesigning our services around AI.
• We are training employees to work with advanced technology.
• We are changing our rewards system to recognize AI-era skills.
• We have tens of thousands of professionals participating in this transformation.

That is compelling material when trying to sell an AI transformation engagement.

The employees receiving bonuses are therefore not necessarily the only beneficiaries of the $100 million program.

The EY brand benefits too.

The Irony Is Hard to Ignore

There is a certain irony in EY effectively presenting itself as a case study in successful AI workforce transformation.

The firm’s own employees are currently confronting many of the exact issues EY’s clients will eventually face.

What happens when technology dramatically increases worker productivity?

Who receives the economic benefit?

Do productivity improvements translate into higher wages?

Does technology reduce workloads — or simply reduce headcount?

Do experienced workers participate financially in the efficiency they create?

How do companies maintain morale while simultaneously telling employees that technology is fundamentally transforming their jobs?

These are not abstract consulting questions.

EY is living through them itself.

And employees watching layoffs, restructuring and relatively modest compensation increases may understandably question whether EY has solved them.

$100 Million Sounds Much Bigger Than It Is

There is another important denominator missing from the headline.

EY US employs tens of thousands of people.

Spread across a workforce of that size, $100 million becomes considerably less extraordinary than the headline suggests — particularly if the program operates over multiple periods or larger awards are concentrated among a relatively small number of employees and teams.

The psychological difference matters.

“EY invests $100 million in employees” sounds transformational.

“Some employees may receive $500 recognition bonuses” sounds considerably less revolutionary.

Both statements can be technically accurate.

Only one makes a great press release.

Recognition Programs Have Another Problem: Who Decides?

There is also the question of how these awards will ultimately be distributed.

Professional-services employees are already intimately familiar with subjective performance systems.

Who gets staffed on visible projects?

Who works directly with influential partners?

Who receives credit for an innovation?

Who gets identified as the person responsible for an efficiency improvement?

Who happens to be in the right group when leadership is handing out recognition?

And who simply works behind the scenes keeping difficult engagements alive?

The more discretionary a compensation system becomes, the more these questions matter.

A larger salary increase doesn’t require an employee to win an internal popularity contest.

It simply appears in the paycheck.

The Timing Is Particularly Bad

EY made this announcement almost exactly one month after employees received FY27 compensation information.

That matters.

Had EY just delivered unusually strong raises across the organization, a $100 million innovation program would look like an additional benefit.

Instead, many employees spent August comparing compensation numbers and asking why their increases were so small.

Then EY announced another enormous-sounding investment in its workforce.

It is not difficult to understand why an employee receiving a 2%, 3% or 4% raise might look at the $100 million headline and respond:

Where was that money a month ago?

EY Is Also Spending Heavily to Attract New Employees

The contrast becomes even more noticeable when looking at EY’s efforts to recruit younger workers.

EY has increased incentives for qualifying early-career employees pursuing the CPA designation and has introduced new development programs designed around careers in an increasingly technology-driven profession.

Recruiting matters.

Developing young accountants matters.

AI investment matters.

But retaining experienced Managers, Senior Managers and other professionals who actually know how to execute complicated engagements matters too.

A firm cannot endlessly emphasize recruiting and developing the workforce of the future while making the workforce of the present feel replaceable.

The Better AI Bonus Would Be Sharing the Productivity Gains

There is actually an opportunity here for EY — and every Big Four firm.

If artificial intelligence genuinely makes accountants and consultants dramatically more productive, employees should participate economically in those gains.

If one professional eventually accomplishes what previously required 1.3 professionals, some portion of that productivity improvement should show up in compensation.

That could mean:

• larger base salary increases,
• meaningful performance bonuses,
• reduced workloads,
• better promotion economics,
• or some combination of all four.

That would give employees an extremely powerful incentive to embrace AI.

Instead of thinking:

“If I automate my work, will EY eventually need fewer people like me?”

employees could think:

“If we become more productive, we participate in the value we create.”

That is a much healthier incentive structure.

The $100 Million Program Isn’t Necessarily Bad — But It Misses the Bigger Issue

EY deserves some credit for recognizing something increasingly important.

Professional services will not simply become a competition over who can use AI the fastest.

Judgment, leadership, client relationships, technical knowledge and the ability to determine when an AI-generated answer is completely wrong are going to become more valuable — not less valuable.

Rewarding those skills makes sense.

But employees are unlikely to forget the broader compensation picture simply because EY announces a $100 million initiative.

After relatively weak raises for many employees, continued restructuring and layoffs, and enormous investments in technology designed partly to increase labor productivity, workers have every right to ask whether they are receiving a fair share of the economics.

And when the same employee compensation program also generates headlines across major media outlets and reinforces EY’s positioning as an AI consulting leader, skepticism is understandable.

EY has effectively created a program that rewards employees while simultaneously advertising the firm’s AI capabilities to prospective clients.

That is clever business.

It does not necessarily make it good compensation.

The people doing the work don’t need another slogan about being “tech-led and human-powered.”

They need to see the value they create reflected in their paychecks.

Updated September 1, 2026

KPMG Australia is facing one of the most serious crises in its history following allegations that confidential client information was improperly shared inside the firm and used to support pitches for lucrative audit engagements.

The controversy has expanded beyond the original data-sharing allegations. It now includes questions about how KPMG treated the whistleblower who raised the concerns, whether the firm’s initial investigations were sufficiently independent and rigorous, and whether the structure of the Big Four creates unavoidable conflicts between audit work and the pursuit of new business.

The fallout has already resulted in leadership resignations, regulatory investigations, government-contract restrictions, client losses, financial penalties and nearly 400 job and partner cuts.

What Is the KPMG Australia Scandal About?

The scandal centers on allegations raised internally by a KPMG whistleblower in 2024.

According to allegations later presented to the Australian Parliament, confidential information belonging to KPMG audit clients was shared with other teams inside the firm. That information was allegedly used to provide KPMG with an advantage when bidding for audit engagements involving competing companies.

The most prominent allegations involved confidential Lendlease board papers that were allegedly used to support KPMG’s bids for the Westpac and Dexus audits. Additional concerns involved confidential information connected to telecommunications company Optus being shared with a KPMG team pursuing audit work from rival Telstra.

Labor Senator Deborah O’Neill publicly outlined the whistleblower’s allegations in the Australian Senate in March 2026. Her statement brought the dispute—which had largely remained inside KPMG since 2024—into public view. The allegations can be reviewed in the Australian Parliament’s Hansard record.

KPMG has since acknowledged that client documents and information were inappropriately shared internally. However, some questions about who knew what, how the information was used and whether it affected particular audit tenders remain subject to parliamentary, regulatory and professional investigations.

Why Is Sharing the Information So Serious?

Accounting firms routinely possess highly sensitive information about their audit clients. This can include board papers, financial forecasts, strategic plans, risk assessments, acquisition discussions and information about competitors.

An audit client must be able to trust that its auditor will protect that information—even from other teams inside the same accounting firm.

Using confidential information to pursue another audit engagement would raise several serious issues:

• It could breach the firm’s duties of client confidentiality.
• It may give the firm an unfair advantage during a competitive tender.
• It can undermine confidence in the auditor’s independence and professional judgment.
• It suggests that commercial incentives may have overridden audit and ethical obligations.
• It makes existing and prospective clients question whether their own information is secure.

The allegations are particularly damaging because auditors are supposed to independently assess whether other companies have appropriate controls, governance and ethical cultures. KPMG’s ability to perform that role depends heavily on its own reputation for integrity.

KPMG Initially Rejected the Whistleblower’s Concerns

The whistleblower reportedly raised the concerns with KPMG’s senior leadership in 2024. An initial internal investigation did not substantiate the allegations.

KPMG then engaged an external law firm to review the original investigation. That review reportedly supported the initial outcome.

The whistleblower continued to challenge the process and brought the matter to independent members of KPMG Australia’s board. A board subcommittee subsequently appointed law firm Allens to conduct another investigation with a wider scope.

By May 2026, KPMG acknowledged that its original investigation had not been conducted with the necessary rigor. The firm also admitted that its management of the whistleblower and its leadership response had fallen short.

KPMG further disclosed that investigators had uncovered another incident involving the inappropriate internal sharing of client information. KPMG’s May 29 statement included an apology to the whistleblower and affected clients.

That reversal was important. The issue was no longer simply an unproven complaint from a former employee. KPMG itself had acknowledged problems with client confidentiality, the quality of its investigations and its treatment of the person who raised the concerns.

KPMG Australia Leadership Resignations

The scandal triggered an extensive leadership shake-up.

Andrew Yates resigned as CEO of KPMG Australia in May 2026. Julian McPherson also stepped down as national managing partner of audit and assurance and agreed to leave the firm following a transition of his client responsibilities.

KPMG said Yates had ultimate executive responsibility for the whistleblower process and the management-led investigations. Both executives said they accepted accountability for the firm’s failures.

In June, KPMG announced that national chairman Martin Sheppard would also leave. Audit partners Paul Rogers and Eileen Hoggett, who had been connected to the handling of confidential information, were also scheduled to depart.

KPMG subsequently appointed Michael Ebeid as its first independent chairman and named John Sams as CEO in July 2026.

The firm also announced plans to restructure its board so that independent directors and KPMG partners would have equal representation. Board committees would provide additional oversight of audit quality, ethics and whistleblower matters. KPMG described the changes in its governance action plan.

KPMG Penalized Seven Partners and Employees

In July 2026, KPMG announced sanctions against seven people after its investigation confirmed what the firm called the unacceptable misuse of confidential client information.

The consequences included:

• Formal warnings
• Restrictions on career progression
• Reduced performance ratings
• Financial penalties of as much as A$180,000
• Previously announced partner departures

Two of the seven people had already retired before the sanctions were announced. Three senior audit partners were reportedly penalized in connection with the misuse of Lendlease documents.

Australia’s corporate regulator, the Australian Securities and Investments Commission, has separately investigated three registered company auditors connected with the allegations. KPMG’s internal disciplinary decisions do not prevent ASIC or professional accounting organizations from imposing additional consequences. Reuters reported details of the sanctions and continuing investigation.

Government Work Was Restricted

The Australian government also responded to the scandal.

KPMG agreed not to bid for new Commonwealth government work from June 16 through September 30, 2026. The restriction applied while the firm’s governance, culture, ethics and integrity frameworks were being independently reviewed.

This was not described as a permanent government ban. However, it prevented KPMG from competing for new federal work during the covered period and created uncertainty over its longer-term government consulting business.

The Department of Finance also referred issues connected with KPMG to the National Anti-Corruption Commission. The Department of Finance published the procurement restriction, while parliamentary and regulatory reviews continued.

Lendlease Decided to Replace KPMG

One of the largest direct consequences came from Lendlease, whose confidential information was at the center of the original allegations.

Lendlease decided to replace KPMG as its external auditor after the completion of its 2026 reporting. The companies had maintained an audit relationship for decades.

Lendlease planned a transition during its 2027 fiscal year so that a new accounting firm could take over the audit beginning in fiscal 2028.

Losing Lendlease was financially significant, but the reputational message may have been even more important: a major audit client concluded that it could no longer continue its long-standing relationship with KPMG following the confidentiality controversy.

Macquarie Abandons Its Planned KPMG Appointment

The newest major update came on August 26, 2026, when Macquarie Group abandoned its plan to appoint KPMG as its external auditor.

Macquarie had intended to replace PwC with KPMG and recommend KPMG’s appointment to shareholders at its 2027 annual general meeting. After reviewing the scandal and the turnover among KPMG’s senior audit personnel, Macquarie decided to retain PwC instead.

Macquarie cited concerns about KPMG’s audit capacity, culture and transparency. KPMG CEO John Sams said the firm respected the decision and recognized that rebuilding trust would require sustained action.

The reversal represents one of the biggest commercial setbacks arising from the scandal. KPMG did not merely lose an existing client; it lost a prestigious audit engagement it had already been selected to inherit. Reuters reported Macquarie’s decision on August 26.

Nearly 400 KPMG Australia Jobs and Partner Positions Cut

On August 24, KPMG Australia announced that it would cut approximately 5% of its workforce.

The reductions included:

• 27 partners
• Approximately 360 employees
• Most of the cuts concentrated in consulting and business services

KPMG Australia’s revenue declined from A$2.28 billion to A$2.26 billion during its 2026 financial year. Consulting revenue fell 17%, partly because of reduced government work and weaker demand.

Average equity partner compensation declined by 13%.

The scandal was not the only reason for the reductions. KPMG also cited economic weakness, difficult professional-services market conditions and longer client decision-making cycles. However, CEO John Sams specifically acknowledged that KPMG was also dealing with challenges created by its own failures.

The firm warned that difficult conditions could continue during fiscal 2027 and beyond. ABC News reported the financial results and workforce reductions.

More Whistleblowers May Have Come Forward

At an August parliamentary hearing, the committee examining the KPMG matter was told that additional whistleblowers had approached lawmakers with misconduct concerns.

The existence of additional complaints does not prove that each allegation is true. Nevertheless, it raises the possibility that the original client-data allegations may not have been an isolated breakdown involving only a small number of employees.

Executives from Macquarie, Westpac, Optus and Dexus also appeared before the committee. Their testimony illustrated how the scandal had damaged KPMG’s standing with some of Australia’s largest companies.

KPMG’s new CEO conceded during the hearing that the firm had failed the original whistleblower and said he would not defend the conduct that had been uncovered. Reuters covered the August parliamentary hearing.

Is This the Same as the PwC Australia Tax-Leaks Scandal?

No. The KPMG and PwC scandals involve different information and different alleged misconduct.

In the PwC Australia scandal, a PwC tax partner received confidential Australian government information concerning proposed tax rules and shared it within PwC’s international network. That information was then used to help clients respond to the government’s tax policies.

The KPMG scandal concerns confidential information belonging primarily to corporate audit clients. The information was allegedly shared inside KPMG to support the pursuit of audit work from other companies.

However, the scandals raise a similar structural concern: Can an accounting firm reliably protect confidential information when other divisions and partners have strong financial incentives to use their knowledge and relationships to win new work?

Could Australia Break Up the Big Four?

Following the KPMG revelations, the Australian government said it would consider structural reforms affecting KPMG, PwC, Deloitte and EY.

Potential reforms could include:

• Separating audit practices from consulting operations
• Giving ASIC greater authority over large accounting partnerships
• Stronger whistleblower protections
• Additional disclosure requirements for accounting firms
• Tougher restrictions on conflicts of interest
• Greater independent oversight of audit-firm governance

Big Four firms in Australia operate primarily as partnerships rather than ordinary public companies. This limits some of the corporate reporting and regulatory requirements that would otherwise apply to organizations of their size.

The government has not yet ordered a formal breakup. Nevertheless, the repeated scandals at major accounting firms have strengthened arguments that voluntary internal controls and partnership governance may be insufficient. ABC News reported that the government was considering an audit-and-consulting split.

What Happens Next?

Several important issues remain unresolved as of September 1, 2026:

1. ASIC must determine whether any registered auditors violated Australian law or professional obligations.
2. Professional accounting bodies could impose separate disciplinary measures.
3. Parliamentary investigators may uncover additional evidence or whistleblower allegations.
4. The government must decide whether KPMG can resume bidding for Commonwealth work after September 30.
5. Other major audit clients may reconsider their relationships with the firm.
6. KPMG must publish results from its independent reviews and demonstrate that its governance reforms are working.
7. Lawmakers must decide whether the scandal justifies broader regulation of the Big Four.

KPMG’s immediate survival is not in question. It remains one of Australia’s largest accounting and consulting firms, with more than A$2 billion in annual revenue.

But the scandal has already imposed substantial costs. KPMG has lost senior leaders, employees, partner income, government opportunities and major audit relationships. More importantly, it has damaged the trust on which an audit practice depends.

The ultimate test will not be whether KPMG announces new policies or appoints independent directors. It will be whether clients, regulators, employees and whistleblowers believe those reforms have genuinely changed how the firm operates.

EY employees have begun sharing their FY27 compensation results, and the early picture is decidedly mixed.

In the annual compensation thread on Reddit’s r/Big4 community, employees are posting their location, service line, level, performance rating, salary adjustment, bonus and—perhaps most importantly—their reaction to the numbers.

While some employees reported double-digit salary increases, particularly around promotions or strong performance ratings, others received increases in the low single digits with little or no bonus. The sharp differences appear to be contributing to frustration among employees who already feel stretched by long hours and a difficult promotion environment.

Promotions Are Still Producing the Largest Raises

Not surprisingly, employees moving into a new rank generally reported the strongest salary increases.

One Northeast audit employee moving from Staff 2 to Senior 1 reported an increase from approximately $96,800 to $108,800, or about 12.4%, along with a performance bonus of roughly $3,700 and a banked promotion bonus. Another Northeast audit employee making the same promotion reported moving from $96,000 to $108,800, along with a $5,000 promotion bonus and approximately $3,600 performance bonus. Both had received EY’s “Strategic Impact” performance rating.

Dallas showed a somewhat different result. An assurance employee moving from A2 to Senior 1 reported a salary increase from $88,500 to $97,780, roughly 10.5%, while receiving a $2,860 performance bonus and banking the promotion bonus. Despite the raise, the employee described the outcome as disappointing and indicated that the weak job market was one reason to remain at EY.

Manager promotions also produced meaningful increases, although expectations appear to have been considerably higher.

A high-cost-of-living FSO tax employee moving from Senior 3 to Manager 1 reported compensation increasing from $120,600 to $139,400, plus a 5% performance bonus. The employee broke the adjustment into an approximately 8.1% market increase and 7.5% promotion increase, but still expressed disappointment, saying the market adjustment was the weakest of their EY career.

That result illustrates an important theme running through the thread: employees are not necessarily evaluating FY27 compensation against zero. They’re comparing it with prior EY compensation cycles, outside-market salaries and the amount of responsibility they have taken on.

Strong Ratings Can Still Produce Strong Raises

Promotion was not the only path to a large increase.

A Senior 2 moving to Senior 3 in Washington, D.C.-area audit reported a Strategic Impact rating and a salary increase from $108,000 to $121,800—approximately 12.8%—plus an $8,032 bonus, equal to about 7.4% of the employee’s prior salary.

That employee was among the relatively few clearly positive voices in the early thread and said the base salary increase was enough to make the overall compensation result satisfactory.

Meanwhile, an FSO audit Senior 1 moving to Senior 2 in a high-cost market, rated Differentiating, reported an increase from $107,000 to $113,000, approximately 5.6%, and a $6,232 bonus.

The contrast suggests that rating, geography, service line and an individual’s position within EY’s salary bands may all have substantial effects on the final adjustment.

The Bigger Problem Appears to Be at Manager and Senior Manager

Some of the most negative reactions came from employees who were not being promoted.

One manager in a medium-cost-of-living assurance market reported moving from approximately $134,000 to $136,700, only around a 2% increase, with no bonus. The employee’s reaction was essentially resignation rather than enthusiasm.

A high-cost-of-living tax Senior Manager reported an increase from $220,000 to $228,000, approximately 3.6%, with a 2% bonus. The employee summarized the outcome in one word: “Yikes.”

Another tax Senior Manager in a very-high-cost market reported only a 3% salary increase and no bonus after more than a decade with the firm and said the result had pushed them toward looking for another job.

Those examples are particularly noteworthy because compensation expectations tend to change as employees move farther up the Big Four hierarchy. Senior Managers often manage substantial client relationships, oversee multiple engagements, develop staff and participate in business development. A 2%–4% adjustment can therefore feel more like a cost-of-living adjustment than recognition of increased responsibility.

Some “Progressing” Employees Were Hit Hard

Performance ratings also appear to matter significantly.

A Midwest Tax GCR Senior 1 moving to Senior 2 with a Progressing rating reported salary increasing from $89,508 to $95,000, approximately 6.1%, but received no bonus.

The employee said the salary increase itself was acceptable, but the lack of a bonus after working substantial late nights was enough to make them consider leaving EY.

An even more dramatic example came from Southeast FSO assurance, where an employee with a Progressing rating reported moving from $83,000 to $84,245—an increase of only 1.5%.

That type of adjustment may help explain why compensation discussions frequently become discussions about retention. Employees aren’t evaluating salary increases in isolation; they’re weighing them against workload, utilization expectations, busy-season hours and alternative career options.

Strategic Impact Bonuses Still Disappointed Some Employees

One interesting theme was that even employees receiving EY’s stronger performance ratings weren’t universally happy.

A Northeast employee receiving Strategic Impact and being promoted into Senior received approximately a 12.4% salary increase but expressed disappointment with a performance bonus of roughly 3.8%.

Another commenter responded that staff-level employees historically have not received especially large performance bonuses, suggesting that the payout may not have been unusual by EY standards.

That distinction is important.

Employees may hear “Strategic Impact” and expect compensation dramatically above peers, while the firm’s actual compensation framework may provide much of the differentiation through salary positioning, promotion increases or relatively modest differences in bonus percentages.

Early FY27 Compensation Examples

The early reports provide a useful illustration of just how wide the range can be:

Market / Service Line	Level Change	Rating	Salary Change	Approx. Raise	Bonus
Northeast Audit	Staff 2 → Senior 1	Strategic Impact	$96.8K → $108.8K	12.4%	~$3.7K + banked promo
Northeast Audit	Staff 2 → Senior 1	Strategic Impact	$96K → $108.8K	13.3%	~$3.6K + $5K promo
Dallas Assurance	A2 → S1	Differentiating	$88.5K → $97.8K	10.5%	~$2.9K + banked promo
HCOL FSO Tax	S3 → M1	Differentiating	$120.6K → $139.4K	15.6% total	5% PBB
Washington D.C. Audit	S2 → S3	Strategic Impact	$108K → $121.8K	12.8%	~$8.0K
HCOL FSO Audit	S1 → S2	Differentiating	$107K → $113K	5.6%	~$6.2K
Midwest Tax GCR	S1 → S2	Progressing	$89.5K → $95K	6.1%	$0
MCOL Assurance	M1 → M2	Progressing	$134K → $136.7K	2.0%	$0
HCOL Tax	SM1 → SM2	Progressing	$220K → $228K	3.6%	2%
Southeast FSO Assurance	No promotion reported	Progressing	$83K → $84.2K	1.5%	Not reported

These numbers should not be interpreted as EY-wide salary bands. Reddit compensation threads are self-reported, employees use inconsistent terminology, and geographic cost-of-living classifications aren’t standardized. But taken together, they provide useful directional information about how employees are experiencing the FY27 compensation cycle.

The Most Important Story May Be Retention

The most striking feature of the thread isn’t necessarily the salary numbers.

It’s what employees say immediately after posting them.

Several posters who received modest increases openly discussed leaving EY. Others indicated they were remaining primarily because the external job market was difficult rather than because they were satisfied with compensation. Meanwhile, employees receiving double-digit increases were substantially more positive about remaining through the next promotion cycle.

That matters for a professional-services firm.

Big Four firms rely heavily on employees remaining long enough to move from staff to senior, senior to manager and manager to senior manager. Losing experienced employees means losing institutional knowledge and forces firms either to promote employees more quickly, recruit experienced hires or shift more work to lower-cost delivery centers.

Compensation therefore isn’t simply an employee-relations issue. It is part of EY’s broader staffing model.

What the FY27 Thread Suggests So Far

The early FY27 numbers point toward a compensation system with increasingly divergent outcomes.

Employees receiving promotions or top ratings can still see increases exceeding 10%. Employees progressing normally without promotion appear much more likely to receive mid-single-digit increases, while some Managers and Senior Managers are reporting adjustments of only 2%–4%.

Bonuses also appear relatively restrained in several of the examples.

The result is a compensation cycle in which two EY employees can both have successful years but walk away with dramatically different perceptions of whether the firm rewarded them.

For employees considering whether to remain in Big Four accounting, that perception may ultimately matter as much as the percentage printed on the compensation statement.

And based on the early FY27 discussion, EY may have a retention problem brewing among exactly the experienced professionals it can least afford to lose.

Source: Self-reported compensation information from the r/Big4 “Official EY FY27 Compensation Thread.” Figures are anecdotal and should not be considered representative of EY’s entire workforce.

Private equity’s march into public accounting reached another major milestone in 2026 when Crowe, one of the largest accounting and consulting firms in the United States, accepted an investment from KKR.

The transaction officially closed on August 7, 2026, with KKR investing in the newly created Crowe Advisory LLC, which now houses Crowe’s tax, advisory, consulting, and other non-attest businesses. Crowe LLP remains a separate licensed CPA firm responsible for audits and other attest services.

The structure is important. Private equity firms generally cannot simply acquire a traditional CPA partnership and operate the audit practice like an ordinary portfolio company because of professional ownership and auditor-independence requirements. Instead, accounting firms accepting outside investment have increasingly adopted an alternative practice structure. The licensed CPA firm remains separate while the economically attractive tax, consulting, and advisory operations sit in an entity capable of accepting institutional capital.

That is precisely what Crowe has done.

A Deal Reportedly Worth Nearly $3 Billion

Crowe and KKR have not publicly disclosed the purchase price or percentage ownership. However, The Wall Street Journal reported that KKR and its co-investors were acquiring a majority interest in a transaction valuing Crowe at nearly $3 billion, while Crowe’s existing partners would retain a minority ownership position.

Crowe generated approximately $1.39 billion in annual revenue, according to reporting surrounding the transaction, making this one of the larger private-equity investments yet in the U.S. accounting profession.

The transaction is particularly notable because Crowe had previously resisted the private-equity trend. As other large accounting firms began accepting institutional capital, Crowe remained one of the larger holdouts. CEO Steven Strammello told The Wall Street Journal that the competitive environment had begun changing more quickly than anticipated.

Eventually, remaining independent may have started to carry its own competitive disadvantage.

Why Does an Accounting Firm Need Private Equity?

At first glance, accounting might seem like an unusual target for private equity.

Accounting firms generally require relatively little physical capital. Their primary assets walk out of the building every evening: accountants, tax professionals, consultants, client relationships, and intellectual property.

But that is precisely part of their attraction.

Accounting firms can generate recurring revenue, have relatively durable client relationships, and often serve industries where switching providers involves substantial disruption. Those characteristics can create predictable cash flows.

At the same time, the industry has entered a period in which scale increasingly matters.

Technology investment is expensive. Artificial intelligence, proprietary tax and audit platforms, cybersecurity infrastructure, data analytics, and automation require levels of investment that may be difficult to fund under the traditional partnership model.

Crowe has specifically said KKR’s investment will allow it to invest more aggressively in talent, technology, innovation, and expanded capabilities.

Acquisitions are another consideration.

A traditional accounting partnership generally distributes a significant portion of annual earnings to its partners. That is attractive to the partners, but it means firms do not necessarily accumulate enormous pools of permanent capital.

Private equity changes that equation.

Instead of funding acquisitions primarily through internally generated cash, partner contributions, or conventional borrowing, Crowe now has access to an institutional capital partner capable of financing a much larger acquisition strategy.

Indeed, Crowe leadership has identified acquisitions and technological investment—including artificial intelligence—as areas where the new capital could accelerate the firm’s growth.

The Partnership Model Is Changing

Perhaps the more interesting question is not why KKR wanted Crowe.

It is why Crowe’s partners were willing to sell.

The traditional accounting partnership has an unusual economic structure. Senior professionals spend years building the firm, eventually acquire equity, receive a share of annual profits, and generally surrender or redeem their ownership when they retire.

There is typically no massive liquidity event comparable to what the founder of a privately held corporation might receive by selling the company.

Private equity changes that.

A transaction can effectively monetize decades of accumulated enterprise value that historically belonged economically to successive generations of partners but was never fully captured by any single generation.

Existing equity partners can receive significant value for interests that previously produced primarily annual distributions.

But that creates an important generational question.

The economics that make a private-equity transaction attractive to today’s partners are not necessarily the same economics that will apply to tomorrow’s partners.

If outside investors own a significant percentage of the advisory business, a portion of the cash flow previously available for distribution among partners must ultimately provide a return to those investors.

That does not automatically mean future partners will earn less. If outside capital allows the firm to grow substantially faster, the remaining ownership interest could become considerably more valuable.

But it does mean the traditional bargain of public accounting is changing.

Historically, employees endured difficult hours and a long promotion process partly because partnership represented ownership of the enterprise itself. In a PE-backed structure, the definition of “partner” may increasingly resemble a senior executive with equity participation rather than a member of a collectively owned professional partnership.

KKR Is Betting It Can Make Crowe More Valuable

Private equity capital is not free capital.

KKR is investing because it expects Crowe to eventually be worth considerably more than the amount implied by today’s transaction.

That return can potentially come from several places: organic revenue growth, acquisitions, technology-driven productivity improvements, greater use of lower-cost delivery centers, expansion into higher-margin advisory services, improved utilization, and potentially higher pricing.

Artificial intelligence could be particularly important.

Professional-services firms traditionally scale by hiring more people. If technology allows one professional to complete work that previously required several employees, revenue could grow substantially faster than headcount.

That possibility helps explain why accounting firms have become increasingly interesting investment targets.

It also creates understandable anxiety among accountants.

The same productivity improvements that make the investment attractive to private equity could alter staffing models, career paths, leverage ratios, and promotion opportunities.

Crowe Is Part of a Much Bigger Transformation

Crowe is not an isolated case.

Private capital has been moving aggressively into accounting since 2021, while firms including Baker Tilly and numerous regional accounting organizations have adopted outside-investment structures. The industry has simultaneously experienced consolidation as PE-backed firms use acquisition capital to build larger national platforms.

Crowe’s decision is important because of its size and because the firm had previously remained outside that movement.

Its eventual decision to accept KKR’s investment suggests something larger about the competitive environment: once enough competitors gain access to substantial outside capital, staying independent can itself become a strategic decision with consequences.

A firm financing technology and acquisitions entirely through partner earnings may eventually find itself bidding against competitors backed by billions of dollars of institutional capital.

At that point, private equity stops being merely an optional source of liquidity for aging partners.

It becomes an arms race.

What Happens Next Matters More Than the Deal Itself

There are two very different versions of the private-equity accounting story that could unfold over the next decade.

In the optimistic version, firms use institutional capital to modernize outdated technology, eliminate repetitive work, make strategic acquisitions, increase employee ownership opportunities, improve client service, and build professional-services organizations capable of competing in an AI-driven economy.

In the less attractive version, firms become increasingly focused on EBITDA growth, utilization, labor arbitrage, cost reductions, debt service, and eventual resale valuations—with employees and future partners carrying much of the burden.

The reality will probably fall somewhere between those extremes.

Crowe now has more capital behind it than at virtually any point in its history. That could allow the firm to make investments that would have been difficult under a traditional partnership structure.

But Crowe also has something it did not previously have: an institutional investor expecting an institutional return.

For employees, clients, and future partners, that distinction may ultimately prove more important than the nearly $3 billion headline valuation.

The Crowe-KKR transaction therefore represents more than another accounting-firm acquisition.

It is another sign that the traditional American accounting partnership—owned by its professionals, funded primarily by its own profits, and passed from one generation of partners to the next—is rapidly becoming a different kind of business.

In 2026, while other Big 4 firms made headlines for layoffs, Deloitte took a quieter—but arguably more important—approach.

Instead of cutting large numbers of employees, Deloitte is changing how its workforce is structured, compensated, and managed.

At first glance, it looks like a routine internal update.

It’s not.

This is one of the biggest shifts in how a Big 4 firm operates in years.

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What Actually Changed at Deloitte

Deloitte recently announced a major overhaul of its U.S. workforce model, affecting tens of thousands of employees.

Here are the key changes:

1. Cuts to benefits for certain employees

For workers placed into its new “Center” talent group (internal support roles like HR, IT, and finance), Deloitte is reducing benefits, including:

• Parental leave reduced (from ~16 weeks to ~8 weeks)
• Paid time off reduced by several days
• Elimination of certain fertility and adoption benefits
• Changes to retirement/pension-related benefits

These changes are set to take effect starting in 2027.

Important: Not all employees are affected—this is targeted at specific roles.

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2. A completely new workforce structure

Deloitte is reorganizing employees into four main groups:

• Core → traditional client-facing professionals
• Project → flexible, project-based roles
• Domain → specialized experts
• Center → internal support functions

This replaces the more traditional Big 4 model where most employees followed a similar career track.

Translation:
Deloitte is moving toward a tiered workforce based on role value and flexibility.

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3. New titles and career paths

As part of the restructuring:

• Many employees are receiving new titles
• A new leadership structure is being introduced
• Career progression is becoming less standardized

The classic “analyst → senior → manager → partner” path is becoming less universal.

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4. A shift in how employees are treated

Historically, Big 4 firms offered relatively consistent benefits and treatment across employees.

Deloitte is now moving toward:

• Different benefits depending on role
• Different expectations depending on value to the firm
• A more segmented employee experience

In short:
Not all Deloitte employees are being treated the same anymore.

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Why Deloitte Is Doing This

1. AI and automation are changing the economics

Deloitte is investing heavily in AI and automation.

That means:

• Some roles (especially internal support and repetitive work) require fewer people
• Other roles (technical, specialized, client-facing) are becoming more valuable

The new structure reflects this shift:
high-skill roles are prioritized, lower-skill roles are optimized for cost.

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2. Cost pressure—even without layoffs

Even though Deloitte continues to generate strong revenue, it’s facing:

• High investment costs (especially in AI)
• Slower growth in some consulting areas
• Lower employee turnover (fewer people quitting)

Instead of layoffs, Deloitte is choosing to:

reduce long-term costs by cutting benefits and restructuring roles

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3. The labor market has shifted

During the 2021–2022 hiring boom:

• Firms increased salaries and benefits
• Competition for talent was intense

In 2026:

• Hiring is slower
• Employees have less leverage

Deloitte is adjusting benefits back toward a more cost-controlled model.

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Why This Matters More Than It Looks

Deloitte’s changes may not be as visible as layoffs—but they could have a bigger long-term impact.

1. The Big 4 “one-size-fits-all” model is ending

Not everyone at the firm is on the same path anymore.

Different roles now come with:

• different pay structures
• different benefits
• different career trajectories

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2. Job security is becoming more role-dependent

Instead of broad stability, job security now depends on:

• how close your role is to revenue
• how specialized your skillset is
• how replaceable your work is

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3. The partnership model is evolving

While Deloitte hasn’t made major partner cuts like KPMG, these changes suggest:

• a more performance-driven system
• less guaranteed long-term progression
• more emphasis on profitability

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Deloitte vs KPMG: Two Different Approaches

Deloitte and KPMG are solving similar problems—but in very different ways.

• KPMG → direct layoffs, including partners
• Deloitte → indirect changes through benefits and structure

In simple terms:

• KPMG is cutting people
• Deloitte is changing the system those people operate in

Both approaches point to the same underlying reality:

the traditional Big 4 model is under pressure

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What This Means for Accountants and Students

If you’re considering a Big 4 career, this shift matters.

Safer roles:

• Client-facing advisory
• Tech-focused roles (AI, data, cybersecurity)
• Specialized expertise areas

Higher-risk roles:

• Internal support functions
• Repetitive or process-heavy work
• Generalist positions without technical differentiation

The takeaway:
Your skillset matters more than your firm.

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Bottom Line

Deloitte didn’t announce mass layoffs.

But what it did instead may be more important.

By restructuring its workforce and reducing benefits for certain roles, Deloitte is:

• lowering long-term costs
• increasing flexibility
• redefining how careers at the firm work

And the biggest takeaway?

The Big 4 are no longer built on uniform career paths and guaranteed progression.

They’re becoming more like modern corporations—where value, not tenure, determines your future.

KPMG Layoffs 2026: Latest Job Cuts in the U.S., UK and Australia

Updated August 29, 2026

KPMG’s 2026 layoffs have expanded into a global restructuring story.

What began with major cuts involving KPMG’s U.S. advisory employees and audit partners has now been followed by additional workforce reductions in the United Kingdom and Australia.

Across the announced and proposed rounds, approximately 1,500 to 1,700 employee positions and partner roles have been eliminated or placed at risk during 2026. However, these were not necessarily part of one coordinated global layoff. KPMG operates through separate national member firms, and each market has given somewhat different reasons for its reductions.

The overall message is still clear: Big Four firms are becoming leaner, employee turnover remains unusually low, consulting demand is uneven, and even partners are no longer protected from workforce reductions.

Latest KPMG Layoffs: Australia Cuts Nearly 400 Roles

The newest KPMG layoffs were announced in Australia in August 2026.

KPMG Australia said it plans to reduce its workforce by approximately 5%, affecting:

• Approximately 360 employees
• 27 partners
• Primarily consulting and business-services positions

KPMG Australia reported total revenue of A$2.257 billion for the year ended June 30, 2026, representing a 1% decline. The larger problem was in consulting, where revenue fell 16.9%.

The firm attributed its decision to weak economic conditions, difficult market conditions, reduced consulting demand and the effects of its conduct and whistleblower matters.

The cuts also follow allegations that KPMG personnel misused confidential audit-client information while pursuing new work. The controversy contributed to leadership departures, government scrutiny and the loss or review of major client relationships.

Despite the overall cuts, KPMG Australia’s audit and assurance revenue increased 11%, while tax and legal revenue increased 10.9%. This suggests the layoffs are concentrated around specific business problems rather than a collapse across the entire Australian firm.

KPMG UK Proposes 200 Additional Job Cuts

In July 2026, KPMG UK proposed eliminating approximately 200 positions, representing around 10% of its group corporate-services workforce.

The affected functions reportedly include:

• Human resources
• Marketing
• Corporate affairs
• Technology
• Procurement
• Other internal support functions

KPMG connected the proposed reductions to the continued integration of its UK and Swiss businesses. The firm said it was looking to eliminate duplicated positions, increase the use of technology and expand offshore delivery.

This distinction matters. The UK reductions were not described simply as a response to declining revenue. They also reflect how KPMG is redesigning its internal operating model following the UK-Switzerland combination.

Earlier KPMG UK Layoffs Put Nearly 600 Jobs at Risk

The July announcement followed a much larger UK restructuring earlier in 2026.

In March, nearly 600 KPMG UK positions were reportedly placed at risk, including as many as 440 jobs in the audit division. The audit reductions were concentrated heavily among qualified assistant managers and represented approximately 6% of the UK audit workforce.

Additional reductions affected advisory employees and smaller groups working in support and economics functions.

One of the primary reasons was surprisingly low employee turnover.

Big Four firms have traditionally expected many employees to leave after obtaining their accounting qualifications. When fewer employees resign, the normal promotion and hiring model can become overcrowded.

In other words, lower turnover—which employees might normally view as positive—created a headcount problem for the firm.

KPMG U.S. Cut Advisory Employees and Audit Partners

The U.S. layoffs announced in April 2026 remain some of the most significant because they affected both employees and partners.

KPMG reduced approximately:

• 4% of its U.S. advisory workforce, or around 400 employees
• 10% of its U.S. audit partners, reportedly around 100 partners

The advisory layoffs were tied primarily to weaker demand in areas such as regulatory-risk consulting, customer operations and financial-services advisory.

At the same time, KPMG said areas including cybersecurity, managed services, forensic services, transactions, strategy and AI-related transformation continued to experience stronger demand.

The audit-partner reductions were more unusual. KPMG reportedly attempted to reduce the size of its audit partnership through voluntary retirements, but those efforts did not produce enough departures.

The firm consequently moved to reduce the number of audit partners directly.

Partner layoffs are especially notable because partnership has traditionally represented the most secure level of employment within a Big Four firm. These reductions demonstrated that even equity ownership does not guarantee permanent protection when the size of the partnership exceeds the firm’s business needs.

Summary of the 2026 KPMG Layoffs

Why Is KPMG Laying Off Employees?

There is no single explanation for every KPMG layoff. However, several recurring factors appear across the different member firms.

1. Employees Are Not Leaving as Quickly

The Big Four employment model relies partly on voluntary turnover. Firms hire large associate classes with the expectation that many employees will eventually leave for corporate accounting, finance or consulting positions.

When the outside job market slows and employees remain longer than expected, firms can end up with too many people at certain levels.

That appears to have been particularly important in the UK audit reductions and the U.S. audit-partner restructuring.

2. Consulting Demand Remains Uneven

Consulting is not experiencing the broad growth that firms enjoyed during and immediately after the pandemic.

Demand may remain strong in AI, cybersecurity, transactions and certain managed services while weakening in regulatory, operational and traditional consulting practices.

This makes firmwide headcount numbers less useful. An accounting firm can be hiring aggressively in one specialty while eliminating hundreds of positions somewhere else.

3. Offshoring Is Expanding Beyond Routine Client Work

KPMG UK specifically referenced expanded offshore delivery as part of its central-services restructuring.

Big Four firms have used offshore delivery centers for years, but the model increasingly affects internal support functions and more complex professional work—not just basic administrative tasks.

That means employees in marketing, technology, human resources and other corporate functions may face some of the same offshoring pressures previously associated with audit and tax delivery work.

4. Technology Is Changing Staffing Needs

KPMG did not attribute every layoff directly to artificial intelligence. Nevertheless, technology investment was expressly included in the reasoning behind the UK corporate-services changes.

AI and automation are unlikely to eliminate the need for accountants entirely. They may, however, allow firms to complete certain tasks using smaller teams.

Employees performing repetitive or highly standardized work could therefore face more pressure than professionals who combine accounting knowledge with technology, client management, regulation or industry-specific expertise.

5. Partnership Is Becoming Less Secure

The U.S. and Australian reductions both included partners.

That may be the most important development in the entire KPMG layoff story.

Partners have always faced performance expectations, but large and publicly reported partner reductions suggest that Big Four firms are managing their partnerships more like corporate leadership structures. When revenue, succession planning or leverage ratios do not support the existing partner population, firms may act more aggressively.

What Do the KPMG Layoffs Mean for Employees and Students?

A Big Four position can still provide excellent training, valuable experience and strong career opportunities. But employees should no longer assume that audit work, strong performance or reaching partner provides complete job security.

Professionals can improve their position by developing experience in areas where technical judgment and client interaction remain important, including:

• Complex tax and accounting matters
• Cybersecurity
• Data analytics
• AI implementation and governance
• Transactions and restructuring
• Industry-specific regulation
• Client relationship management
• Technology-enabled audit and compliance work

Employees should also keep their resumes updated and maintain relationships outside their immediate teams. Layoffs are increasingly driven by practice economics, utilization, location and organizational structure—not merely individual performance.

Are More KPMG Layoffs Coming in 2026?

It is impossible to know whether KPMG will announce additional reductions before the end of 2026.

However, the Australia announcement warned that difficult conditions could persist, while the UK and U.S. reductions addressed longer-term structural issues such as low attrition, offshoring, technology investment and partner leverage.

Those issues are unlikely to disappear immediately.

Additional targeted reductions remain possible even if KPMG continues hiring in practices connected to AI, cybersecurity, transactions and other growth areas.

Bottom Line

KPMG’s 2026 layoffs are no longer an isolated reduction in one struggling consulting group.

During the year, different KPMG member firms have reduced or proposed reducing:

• U.S. advisory employees
• U.S. audit partners
• UK auditors and advisory professionals
• UK corporate-services employees
• Australian consultants, support employees and partners

The specific causes vary by country, but the broader direction is consistent: Big Four firms are managing headcount more aggressively, relying more heavily on technology and offshore delivery, and showing less hesitation about eliminating positions at every level.

The most important takeaway remains the same:

Even partners are no longer untouchable.

Layoffs at EY have intensified throughout 2025, reaching deep into the U.S. firm’s core service lines: Audit, Tax, and Consulting. While layoffs have been ongoing globally, the U.S. has seen a distinct pattern of staff being quietly let go—sometimes regardless of performance.

This post breaks down which service lines are being hit, what levels are affected, and how year-end performance ratings like “NTP” (Needs to Progress) are being used to carry out these cuts.

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Key Takeaways

• Audit, Tax, and Consulting are all being impacted—Audit and Consulting the most.
• Cuts affect Staff 1 through Manager levels, with some roles let go shortly after year-end reviews.
• Many affected employees had positive performance reviews or met expectations.
• Severance is minimal—often just 4 weeks, with little notice.

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EY Layoffs by U.S. Service Line

1. Audit (Assurance)

Despite its reputation as the “safe” service line, Audit is no longer immune to layoffs.

Who’s Affected:

• Staff 2 to Managers across various U.S. regions
• Some Seniors and Managers reportedly laid off weeks after receiving “Meets Expectations” ratings in year-end reviews
• EY is also cutting Client Technology Assurance (CT Assurance) roles, particularly in offshore delivery centers

Common Scenario:

“I was a Senior who had a good year-end review. Still got the ‘status discussion’ and was let go with 4 weeks severance.”

Reasoning:

• Consolidation of audit support in Global Delivery Centers (GDS)
• Loss of 80+ public company clients in 2023–24
• Pressure to flatten teams and reduce U.S. payroll costs

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2. Tax

Tax has seen selective layoffs, primarily driven by restructuring and performance filtering.

Who’s Affected:

• Mostly Staff 1–2 and a few Seniors with “Needs to Progress” (NTP) ratings
• Layoffs are more performance-based than structural in Tax, according to insiders

Common Scenario:

“I got an NTP for not meeting billable hour targets. Two weeks later I was let go.”

Notes:

• NTP seems to be used more consistently in Tax as a legitimate performance label
• Some remaining roles are being moved to EY GDS centers abroad

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3. Consulting (Advisory)

Consulting has faced the most aggressive cuts in the U.S. and globally due to weak client demand.

Who’s Affected:

• Staff 1–3, Senior Associates, and Managers in Technology Risk, Strategy & Transactions, and other advisory groups
• Layoffs impacted even those with “Meets” or “Exceeds Expectations” at year-end

Common Scenario:

“Was rated ‘Meets Expectations’ in my performance review. Three weeks later, was given a meeting with HR and told my role was being eliminated.”

Reasoning:

• Slump in client projects post-2024
• Overcapacity after hiring spikes during COVID-era growth
• Move to offshore some delivery roles

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The Role of Year-End Evaluations

What is “NTP”?

• NTP = Needs to Progress
• A formal rating assigned during performance evaluations indicating that the employee is not meeting expectations
• Often used as a soft layoff trigger, even when no Performance Improvement Plan (PIP) is offered

Patterns Observed:

Rating Given	Outcome
Exceeds Expectations	Safe for now, though some still cut due to role elimination
Meets Expectations	Many still laid off due to “business decisions” or “restructuring”
Needs to Progress (NTP)	Frequently followed by a layoff notice within 2–4 weeks
No Rating / Mid-Year	Often let go before the cycle or during mid-year realignments

“I had a good year-end review. Then I was told I was part of a business restructuring. No one mentioned performance again.”

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Severance & Transition Details

• Most U.S.-based professionals are receiving:
  • 4 weeks severance
  • Healthcare coverage through the end of the month
  • Access to job placement tools (mildly helpful at best)
• No retention bonuses or transition roles were widely reported

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What To Do If You’re at Risk

1. Clarify your rating: Ask your counselor/manager to provide written feedback if labeled NTP.
2. Document everything: Keep records of performance reviews, communications, and work metrics.
3. Start job searching immediately: Especially if you’re Staff 2+, as similar firms are now flooded with candidates.
4. Leverage your EY experience: The Big 4 brand still carries weight in industry roles—FP&A, internal audit, tech risk, etc.

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Final Thoughts

EY’s 2025 U.S. layoffs are broader and more unpredictable than in previous years. While the firm is citing performance in some cases, the reality is that many high-performing employees have been let go due to structural realignments, client attrition, and global cost-cutting.

Whether you’re in Audit, Tax, or Consulting—if you’re labeled NTP or if your team seems overstaffed—start preparing now.

The new Big 4 reality? No role is fully safe, and performance alone might not protect you.

Each summer, professionals at EY await updates on compensation—raises, promotions, and bonuses that reflect their hard work and market trends. FY26 (summer 2025) was no exception, and Reddit’s r/Big4 and r/Accounting communities once again served as a valuable source for firsthand data.

This post breaks down the trends, numbers, and reactions from employees across the U.S. and Canada during EY’s FY26 compensation cycle.

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Timing of Raises & Promotions

EY’s annual compensation updates typically take effect in early August, with promotions officially effective October 1. However, salary adjustments are reflected in August or September paychecks, depending on region and payroll cycle.

“Annual pay raises come in every August, unless you get some sort of early promo… which would increase your pay in Jan.”
— Reddit user, r/Big4

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FY26 Raise & Bonus Patterns

Reddit threads provided a wealth of data showing that raises varied widely based on:

• Location (LCOL, MCOL, HCOL)
• Performance rating (Progressing, Differentiating, Strategic Impact)
• Service line (Audit, Tax, Consulting, Tech Risk)
• Promotion eligibility

Real Examples

Role/Market	Raise %	Bonus	Notes
CBS (VHCOL) Senior Assoc → Supv. Assoc	~15%	3.6%	$135K → $158K
Tax, Staff 2 → Senior 1 (Midwest HCOL)	9%	~$5K + 3%	Broke $100K barrier
Tech Risk, SDC (LCOL)	11.7%	3.25%	Rating: Differentiating
Audit, Staff 1 → Staff 2 (VLCOL)	8%	3.25%	~$75K → ~$81K
Digital Consulting, HCOL	4%	$0	Rating: Progressing
Audit FSO S3 → M1 (MCOL)	24.5%	10.5%	Rating: Strategic Impact

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Performance Ratings Matter—A Lot

FY26 saw stricter enforcement of bonus eligibility:

“If your ranking is ‘Progressing’ or ‘Need to Progress’ you won’t get a bonus.”
— r/Big4 thread, FY26 EY compensation

This surprised many, as previous years offered at least modest bonuses for mid-performing employees.

Ratings directly affected:

• Merit/market raises
• Promotion eligibility
• PBB (performance-based bonus) percentages

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Redditor Sentiment

EY’s raises drew mixed reviews this year. Some users were satisfied with double-digit gains tied to promotions. Others—particularly in consulting or with “Progressing” ratings—expressed frustration:

“EY had that 10% salary increase across the board… they said it’s going to be every year for the next 3 years… I’m skeptical.”
— r/Big4, on the $1B EY talent initiative

Many pointed out that while entry-level and new hire pay was clearly rising, raises for existing employees were inconsistent across teams and service lines.

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Quick Takeaways

Category	Summary
Raise Timing	Early August effective date; seen in Aug/Sept paychecks
Raise Size	Ranged from 2–5% (merit only) to 25%+ (promo + strong rating)
Bonuses	Reserved for “Differentiating” or higher; ~$2K–$15K common
Disappointment Areas	Consulting, HCOL regions with flat raises, Progressing-rated staff
Bright Spots	Promotions in Audit/FSO, Strategic Impact ratings, lower COL markets

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Final Thoughts

EY’s FY26 compensation cycle reflects a more performance-driven, selective bonus culture, especially as economic pressures tighten budgets. High performers were rewarded—often significantly—while average-rated employees in some practices saw minimal change.

For those aiming to maximize compensation in FY27, it’s clear that promotion + high performance ratings are key—and that bonus eligibility now has stricter gates than in prior years.

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PwC Begins Major Workforce Cuts

PwC is undergoing one of its largest workforce realignments in recent years. In its latest fiscal year, the firm cut approximately 5,600 jobs globally, a significant reversal from earlier hiring goals. These reductions span support roles, client-service teams, and specific international regions that have seen major market disruptions.

While the Big Four are no strangers to periodic restructuring, this round is notable for both its scale and timing — following several years of aggressive hiring and expansion.

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U.S. Impact: Cuts Across Support and Client-Facing Roles

Latest Cuts: Business-Services Functions

In November 2025, PwC eliminated around 150 roles across U.S. business-services functions, including:

• HR

• Marketing

• Internal IT

• Learning & development

• Operations and administrative support

These cuts represent roughly 1.5% of the U.S. business-services workforce. They reflect PwC’s push toward leaner internal operations, cost control, and greater use of automation in administrative tasks.

Earlier 2025 Cuts in Tax & Assurance

Earlier this year, PwC also cut approximately 1,500 U.S. jobs (about 2% of its tax and assurance practice).
The firm cited:

• Historically low attrition

• Overstaffing relative to client demand

• A need to rebalance talent pipelines

This is especially notable because PwC — like other Big Four firms — had significantly ramped up hiring in 2021–2022 during the post-pandemic advisory boom.

In May 2025, PwC announced the layoff of approximately 1,500 employees in the United States, representing about 2% of its 75,000-person U.S. workforce. This move primarily affected the firm’s audit and tax divisions and was attributed to historically low attrition rates, leading to staffing surpluses.

There is no secret that less people have been leaving the big 4 in recent years. This is primarily due to better policies around working from home. It’s a lot easier to deal with big 4 headaches when you don’t have to go into the office everyday. Additionally, a lot of clients are working from home or are remote, so it’s not necessary to go into their offices. With little to no commuting, dealing with the stresses of the big 4 is a lot easier and fewer people are leaving.

It must also be remembered that the big 4 don’t necessarily do things that make sense. They laid off some new hires but are still hiring more people. I’m sure the people that were laid off had low utilization. The key is to stay utilized. This is always the case. If you don’t have good utilization, then the firms will view as a problem.

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International Layoffs: Middle East Hit Hard

Globally, the largest international impact occurred in PwC’s Middle East operations, where the firm reportedly cut ~1,500 employees and 60 partners. The catalyst was a high-profile dispute with Saudi Arabia’s sovereign-wealth fund, which temporarily limited advisory contract opportunities in the region.

PwC had previously identified the Middle East as a major growth engine — making these cuts especially significant.

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Why PwC Is Cutting Jobs Now

1. Slowing Revenue Growth

PwC reported 2.9% global revenue growth in FY2025 — down from 3.7% in 2024 and nearly 10% during the pandemic-recovery boom. Advisory demand, in particular, has cooled as clients refocus on cost control.

Slower growth = less room for excess capacity.

2. Overhiring During the Boom Years

From 2021–2023, PwC aggressively expanded headcount. Now, with attrition falling sharply, the firm has more staff than it needs — particularly at junior levels and in internal support.

3. Technology & Automation

Functions like HR, marketing, administrative support, and even parts of audit are becoming more automated. Internal teams are shrinking while investments shift toward:

• AI-enabled audit tools

• Tax automation platforms

• Digital assurance services

• Consulting in cloud, cybersecurity, and transformation

4. Market-Specific Shocks

In the Middle East, geopolitical and regulatory issues directly impacted revenue, forcing rapid cuts.

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What This Means for Students and Job Seekers

Hiring Will Be More Selective

PwC (and other Big Four firms) are tightening both campus recruiting and experienced-hire pipelines. Fewer full-time offers and more targeted hiring are expected through 2026.

Support Roles Are Most Vulnerable

Marketing, HR, operations, and internal IT have been first in line for reductions.

For students:
→ Core service lines (audit, tax, advisory) remain safer — but growth will not match pre-2023 levels.

Expect More Skills-Based Hiring

Technical skills now matter more than ever:

• Data analytics

• Digital audit tools

• Python/SQL

• Tax automation platforms

• Cybersecurity and cloud skills

Students with tech fluency will have an advantage.

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What This Means for Current PwC Employees

• Expect continued restructuring, especially in internal functions.

• Promotions may slow in certain service lines due to tighter leverage models.

• Client demand is still stable, so layoffs are likely to stay targeted rather than firm-wide.

• Employees in transformation-focused areas (cloud, data, AI, cybersecurity) are safest — these teams are still hiring.

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Impact on the Big Four Landscape

PwC is not alone. All the Big Four firms have:

• Slowed revenue growth

• Reduced hiring targets

• Shifted investment toward AI and automation

• Tightened their staffing leverage model

However, PwC’s cuts are among the most public and substantial so far — and may signal what’s ahead for Deloitte, KPMG, and EY.

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Is This the Beginning of a Bigger Trend?

Probably. The Big Four rode a once-in-a-generation boom between 2020–2022. That expansion created a hiring bubble that is now normalizing.

Expect:

• More selective recruiting

• Smaller starting classes

• More internal reshuffling

• Heavier use of outsourcing and automation

But don’t expect a collapse — the Big Four business model remains robust, and demand for audit and tax is structurally stable.

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Takeaways

• PwC has laid off ~5,600 employees globally this year.

• U.S. business-services cuts: ~150 roles.

• U.S. tax & assurance cuts: ~1,500 roles.

• Middle East layoffs: ~1,500 employees + 60 partners.

• The primary drivers: slower growth, overhiring, lower attrition, and market-specific challenges.

• Students and job seekers should expect more competitive recruiting and greater emphasis on tech skills.

Deloitte Layoffs 2025: Navigating Federal Consulting Cuts and Industry Shifts

In April 2025, Deloitte, one of the “Big Four” accounting and consulting firms, announced a round of layoffs within its U.S. operations. These cuts primarily target the Government and Public Services (GPS) division, a segment heavily reliant on federal contracts. While the firm has not disclosed the exact number of impacted employees, reports suggest the layoffs are directly tied to substantial reductions in government consulting work.

The Cause: Federal Contract Reductions

The layoffs stem from a broader initiative led by the Trump administration’s Department of Government Efficiency (DOGE). Since January 2025, the federal government has either canceled or modified at least 127 consulting contracts, reducing Deloitte’s potential revenue by approximately $371.8 million. This move is part of DOGE’s push to cut back on spending for external consulting services, directly impacting major players like Deloitte.

The General Services Administration (GSA) has played a key role in reassessing and scaling back consulting contracts across agencies. Deloitte, which holds a significant portfolio of federal consulting engagements, has felt these cuts acutely within its GPS division.

Deloitte’s Response

Deloitte framed the layoffs as “modest personnel actions,” attributing them to moderating growth in some areas, evolving client needs, and a lower-than-expected rate of voluntary employee attrition. However, for many within the GPS division, particularly those not currently assigned to active projects, the layoffs are a stark reminder of the volatility in federal consulting.

In response, Deloitte is reportedly working to reassign affected staff to other areas within the firm. Yet, given the scale of contract reductions, these efforts are proving challenging.

Broader Industry Implications

Deloitte’s layoffs signal broader uncertainties within the federal consulting space. The DOGE-driven spending cuts have affected multiple firms, with ripple effects throughout the consulting sector. For firms like Deloitte that have heavily invested in government services, adapting to these changes requires strategic shifts, including diversifying client bases and re-evaluating service offerings.

As the federal government continues to scrutinize consulting expenditures, firms operating in this space may face increased pressure to demonstrate value, efficiency, and measurable outcomes. For Deloitte, navigating these shifts will be crucial in maintaining its leadership position within the industry.

Conclusion

The recent layoffs at Deloitte reflect both internal adjustments and external pressures stemming from significant federal policy changes. As the consulting landscape continues to evolve, firms like Deloitte will need to adapt swiftly to changing client demands and market realities. For employees within federal consulting, the current environment underscores the importance of flexibility and the potential need to explore opportunities in other sectors.

Stay tuned for further updates as this situation develops and reshapes the consulting industry in 2025.