KPMG Layoffs 2026 – 600 Jobs Cut in UK While Partners Get an 11% Pay Raise

One term that appears so frequently in corporate restructuring announcements that it has nearly become meaningless is “excess capacity.” On March 27, 2026, KPMG UK used it to discreetly notify employees via an internal memo that about 600 jobs, mostly in its audit division, were in jeopardy. The wording was methodical and cautious. The reality it portrayed was more straightforward: the company had too many employees at a particular level and not enough work to support their retention, so the company decided to let them go because they weren’t quitting on their own.

The numbers show that about 440 of the targeted positions are assistant manager positions in KPMG’s audit division, which is a group of qualified accountants who are two to three years post-qualification. The advisory arm is anticipated to add another 120 positions.

Together, they make up about 6% of KPMG UK’s 7,100 audit employees; however, some observers have pointed out that because the cuts are concentrated at the assistant manager band, they probably feel much more severe in practice than that percentage indicates. In the UK, KPMG employs roughly 16,700 people overall, and in recent years, it has been aggressively expanding that number.

In many respects, the current issue stems from that growth. Like its Big Four competitors, KPMG made aggressive hiring decisions following the pandemic to address the perceived severe talent shortage at the time. A major component of the strategy was hiring people from abroad. The reasoning made sense in 2021 and 2022, when there was a high demand for audit and advisory services and attrition was occurring at a rate that allowed for natural employee turnover.

Hiring disparities were absorbed by that churn. The pyramid remained roughly in the correct shape as people came and went. The churn then stopped sometime in 2024 or early 2025. Employees were wary due to economic uncertainty. Many of those hired from abroad chose to remain in the country, in part because it was difficult to leave due to visa arrangements. The pipeline became full. The work wasn’t growing quickly enough to support everyone staying in, and no one was leaving.

The advisory industry offers some helpful background. In 2025, KPMG’s advisory revenues decreased by 3%, which is indicative of a slowdown in project spending and deal activity that has impacted not only KPMG but also Deloitte, PwC, and EY. In their most recent financials, PwC UK reported a 3 percent decline in both consulting and risk practices.

Revenues from consulting at EY UK fell by 6%. Together, the Big Four lost more than 900 positions in the UK in 2024, and more than 1,800 in 2023, and the trend in 2026 indicates that those figures aren’t stabilizing. What is taking place at KPMG is not a singular decision; rather, it is a component of a profession-wide reckoning that has been developing for some time and is now coming in waves.

Another aspect that is important to consider is fee pressure. Particularly as AI and automation tools start to alter what audit work actually requires in terms of human hours, clients have become more and more reluctant to pay rising audit fees. The conventional approach, which involves sizable groups of mid-level accountants completing compliance and verification tasks, is beginning to look inefficient in comparison to software that can complete the same tasks more quickly and affordably.

The irony of KPMG’s investment in AI tools is that it puts pressure on the very layer of the workforce that it is currently eliminating: skilled workers performing repetitive, structured analytical tasks. In simple terms, James Ransome, head of consulting at Patrick Morgan, described ongoing pressure from outcome-based pricing, AI lowering delivery effort, and fee compression.

The contrast between these layoffs and reported 11% increases in partner pay has drawn sharp criticism. Given that partners are the ones who generate revenue and whose retention directly affects client relationships, this combination—cutting employees at one level while increasing compensation at the top—is not exclusive to KPMG and may even be justified from a purely financial standpoint.

However, the optics are challenging. At nearly the same time as the announcement that those at the top were receiving an 11 percent raise, 440 assistant managers received a notification in late March that they were not earning partner-level compensation. The timing was publicly noted by several industry commentators. It’s difficult to believe the company didn’t foresee that response.

There’s a feeling, tracking this story against the broader arc of professional services employment since 2022, that the Big Four’s traditional workforce model — hire aggressively, rely on natural attrition to keep levels balanced, promote the best and move the rest along — is running into a structural problem it hasn’t fully solved. The model breaks when the outside job market tightens, and attrition slows to a crawl.

As costs increase, the middle of the pyramid becomes too wide, and eventually someone must make a choice that no professional services company wants to make in public. Three years later, KPMG is doing the same thing that PwC UK did in 2023, targeting about the same number of employees for the same stated reason—low attrition, excess capacity.

It’s still unclear if this is a short-term fix or a longer-term change in how these companies handle their talent pipelines. It appears more obvious that the assistant managers undergoing redundancy consultation at KPMG’s London offices are dealing with the fallout from choices made during a hiring cycle that now appears, from a distance, to be far more optimistic than it should have been.