McKinsey & Company is offering many high-level staffers in the UK a chance to resign in exchange for nine months’ salary and additional benefits. The employees in question will also be able to utilize this time to secure new employment without any obligation to work on client assignments.
In Short
- McKinsey offers senior employees to voluntarily leave.
- Aim to reduce headcount amid sector downturn.
- UK managers given option for 9-month job search period.
The Times reported that McKinsey managers within the UK side of the business are being presented with the option to dedicate up to nine months to a “job search” period. During this period, employees are able to utilize their work hours to search for new job opportunities and opt out of participating in client projects.
Meanwhile in the US, some McKinsey consultants have been warned that they are running out of time to win a promotion. The “up or out” policy is an approach used at many global consulting firms, where it’s expected that employees are promoted within a specific time-frame or exit.
Memos raising the “up or out” pressure on staffers were sent out to some engagement managers and associate partners in North America. Bloomberg reported that employees in this position were reminded that they have an average of two and a half years before being promoted, according to people in the know. The timeline for promotions varies by employee and those who took periods of absence will not be negatively impacted. Some of the employees who received memos also received offers for payouts if they choose to leave McKinsey before their reviews in the coming months.
The developments suggest that McKinsey may be rethinking its policies after several years of aggressive hiring and low attrition rates. Last year, the company had embarked on a plan to eliminate about 1,400 roles — a sharp deviation from it’s typical habit of relying on underperforming workers being “counseled to leave”. Most of the affected employees didn’t have direct contact with clients and were focused on support functions.
Earlier this year, the senior partners reelected Global Managing Partner Bob Sternfels for a further three years, at a time when the consulting industry is facing a slowdown in client activity, public scrutiny and economic headwinds — although McKinsey said it generated a record $16 billion in revenue last year.
What has McKinsey told its employees?
According to reports, the company has informed employees that they will continue to receive their full salary during this period. This could amount to hundreds of thousands of pounds if employees utilise the entire nine-month duration. These managers will also have access to McKinsey’s resources and career coaching services, as reported by The Times. Staff members will be required to leave McKinsey even if they cannot find a new job during this period, it was mentioned.
McKinsey’s job-cutting measures in the past
McKinsey previously attempted to reduce its workforce amid a downturn as in 2023, the company announced plans to cut approximately 1,400 jobs, which accounts for around 3% of its workforce, Bloomberg then reported.
In February this year, McKinsey gave poor performance ratings to 3,000 employees who were then given around three months to improve their performance or they could leave the company, the report added.
