McKinsey, the management consulting firm, has now decided to provide career coaching services and nine months’ pay to employees leaving the firm. Rather than working on client projects, managers can now spend nine months looking for jobs while still on the payroll from McKinsey.
Employee assistance initiatives
Apart from this, McKinsey will also provide access to its resources and career coaching services for these employees. However, if the job hunt remains unsuccessful even after nine months, the managers would still have to leave.Managers at McKinsey’s US offices have also received the same offer, albeit the pay duration offered might be different.
What is the purpose of this move?
A McKinsey spokesperson says that the reason behind this move is to help their employees “grow into leaders, whether they stay at McKinsey or continue their careers elsewhere.”
He further stated that “these actions are part of our ongoing effort to ensure our performance management and development approach is as effective as possible, and to do so in a caring and supportive way.”
This wouldn’t be McKinsey’s first attempt at reducing its workforce amidst a downturn in the consulting sector. The firm mentioned that it plans to trim approximately 1,400 jobs or around 3% of last year’s total headcount.
Performance pressure on the employees
According to reports, McKinsey gave 3,000 employees poor performance ratings in February. These employees have been given three months to enhance their performance or they’d be asked to leave.
These reports further stated that senior employees were given approximately two and a half years to be promoted, increasing the pressure on employees to work hard enough to receive promotions or to leave.
Here’s a list of the major layoffs announced by US companies in 2024:
Google (NASDAQ:GOOGL): Hundreds of workers were laid off in its central engineering division and hardware teams, including those working on its voice-activated assistant.
Discord: Announced layoffs of 170 employees due to rapid growth leading to inefficiencies in operations.
Citigroup (Citi): 20,000 jobs are set to be cut as part of a corporate overhaul to restructure the business.
Twitch: Over 500 positions were eliminated, affecting over a third of the employees at the live-streaming company.
BlackRock (NYSE:BLK): Planning to cut 3% of its workforce, affecting around 600 people, while expanding in other areas to support growth in overseas markets.
Rent the Runway: Slashing 10% of its corporate jobs as part of a restructuring, including the departure of COO and president Anushka Salinas.
Unity Software: Eliminating 25% of its workforce, affecting around 1,800 jobs, to improve operating efficiencies.
eBay (NASDAQ:EBAY): Cutting 1,000 jobs, about 9% of its workforce, due to outpaced growth in expenses compared to business growth.
Microsoft (NASDAQ:MSFT): Reducing headcount by 1,900 at divisions like Activision, Xbox, and ZeniMax, following its acquisition of Activision Blizzard (NASDAQ:ATVI).
Salesforce: Laying off 700 employees, about 1% of its global workforce, as part of ongoing restructuring efforts.
Flexport: Laid off 15% of its staff, approximately 400 workers, after raising funds and aiming to return to profitability.
iRobot: Cutting around 350 jobs, with founder Colin Angle stepping down as chairman and CEO amid failed acquisition talks with Amazon (NASDAQ:AMZN).
UPS: Planning to cut 12,000 jobs, affecting 14% of its management staff, to save $1 billion by the end of 2024.
Paypal: Laying off 2,500 employees, about 9% of its workforce, as part of a restructuring to drive profitable growth.
Okta: Eliminating roughly 7% of its workforce, impacting around 400 employees, to improve operating efficiencies.
Snap: Announcing a 10% reduction in its global workforce, affecting undisclosed number of jobs, to improve cost structure.
Estée Lauder: Eliminating up to 3,100 positions, about 3% to 5% of its roles, as part of a restructuring plan.
DocuSign: Cutting approximately 6% of its workforce, with most reductions in sales and marketing divisions, to improve efficiencies.
Zoom: Slashing 150 jobs, about 2% of its workforce, as part of ongoing cost-cutting measures.
Paramount Global: Laying off 800 employees, approximately 3% of its workforce, following record-breaking Super Bowl viewership.
Morgan Stanley (NYSE:MS): Trimming its wealth management division by hundreds of staffers, about 1% of its team, to streamline operations.
Cisco (NASDAQ:CSCO): Slashing more than 4,000 jobs, 5% of its workforce, due to a slowdown in corporate tech spending.
Expedia Group: Cutting over 8% of its workforce, around 1,500 roles, to reallocate resources and focus on growth areas.
Sony: Laying off 900 workers from its game-making teams at PlayStation Studios amid missed PlayStation 5 sales targets.
Bumble: Reducing staff by 30%, or about 350 roles, to align with future strategic priorities for the business.
Electronic Arts (NASDAQ:EA): Eliminating about 5% of its workforce, or roughly 670 jobs, due to shifting customer needs and a refocusing of the company.
IBM (NYSE:IBM): Cutting staff in marketing and communications, following a broader workforce rebalancing initiative announced earlier.
Stellantis: Slashing 400 white-collar jobs in engineering, technology, and software teams to reduce costs.
Amazon: Announcing layoffs of “up to 160 roles” in its advertising unit, following several rounds of cuts last year.
Axel Springer: Joining 31 other media groups in a $2.3 billion suit against Google, alleging losses due to its advertising practices.