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Accenture to cut promotions and bonuses amid global layoffs

Published Nov 14, 2023 09:26AM ET
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NEW YORK - In response to the need to control costs, Accenture (NYSE:ACN) has taken significant steps affecting employees worldwide, including layoffs and changes to compensation structures. An employee recently affected by these measures shared his perspective on the situation, highlighting his anticipation for new opportunities and appreciation for the support received during his tenure with the company.

Earlier this year, a wave of layoffs swept across tech companies as they sought to reduce expenses. Accenture was among those corporations, dismissing 19,000 employees globally. The trend of job cuts has now reached the United States, though specific figures have not been disclosed.

One individual from the Trust and Safety team who had been with Accenture for over four years, collaborating with Meta (NASDAQ:META), was part of the recent layoffs. Despite the setback, he expressed a positive outlook on his future career prospects and the chance to spend more time with his family. He plans to leverage his skills in operations, program and project management, training, quality assurance, and data analysis in a new professional setting.

Accenture India made an announcement last month indicating that salary increases would be put on hold this year except where legally required or in certain areas with critical skills. Managing Director Ajay Vij communicated this decision via email, explaining that it is part of Accenture's strategy to offer competitive pay based on skills and location while ensuring financial stability for the firm.

Additionally, Accenture is set to adjust its approach to promotions and bonuses. While performance-based bonuses will still be given out, they will be considerably less than those awarded in the previous year. Promotions up to the level of Associate Director (Level 5) are scheduled for December but at a reduced rate. For employees ranging from levels 1 through 4, promotions have been postponed until June 2024.

These developments reflect Accenture's broader strategy to navigate economic challenges while balancing the need to reward talent appropriately against the backdrop of a dynamic global business environment.

InvestingPro Insights

Accenture (ACN) is not just navigating economic challenges; it's also delivering impressive financial results. According to InvestingPro data, Accenture boasts an adjusted market capitalization of $198.09 billion and a P/E ratio of 29.01 as of Q4 2023. The company has also demonstrated a substantial revenue growth of 4.09% in the last twelve months as of Q4 2023.

InvestingPro Tips reveal that Accenture has a history of high earnings quality, with free cash flow consistently exceeding net income. The company also yields a high return on invested capital and has been successful in increasing earnings per share. Despite the recent changes in the company structure and compensation, Accenture has maintained its dividend payments for 19 consecutive years, a testament to its financial resilience.

For more detailed insights and tips, consider exploring the InvestingPro platform. It offers a wealth of information, including over 19 additional tips for Accenture alone, to help you make informed investment decisions.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Accenture to cut promotions and bonuses amid global layoffs
 

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