“We somehow stopped the meritocracy,”

Stephen Foley and Simon Foy:

“We somehow stopped the meritocracy,” said one former McKinsey partner who remains close to the firm. “We stopped pushing people to leave and had an enormous overhang of people. When that happens the numbers just get staggeringly bad. Don’t we advise companies on this?”

The sharp decline in attrition is a phenomenon across professional services firms and around the world, compounding the effect of a slowdown from the post-pandemic boom in advisory work on digital services and mergers and acquisitions.

Deloitte publishes a staff turnover figure in its annual report, which last year showed departures at their lowest level in a decade both globally and in the Americas. KPMG noted “capacity issues created by ongoing and historically low attrition” when it cut jobs in its US audit business in March. Bain also cited lower attrition when offering some consultants in London redundancy with six months’ pay, partly paid temporary leave, or an option to relocate to one of the firm’s offices abroad.