PwC set to hand 25,000 junior staff a real-terms pay cut – despite FRC plea to give them more
Big four firm PwC has reportedly told its junior auditors their pay is going to be frozen, amid concerns it will make the industry less attractive.
According to reports in the FT, around 25,000 staff members are set to get lower pay rises, with the accountancy giant citing the challenging market conditions and pay rises’ impact on inflation.
In a webcast, its junior staff members were told about the pay freeze, while others would get a real term pay cut, with a salary increase of between 3-6 per cent.
After the webcast, a note was reportedly sent round telling employees they would be getting a smaller pay rise, following last year’s major increase, done in a bid to retain staff.
In a statement to City PM, PwC said: “Fair reward, career progression and professional development are core to our business.
“Following record pay increases last year, we have again invested in salary uplifts across our business. Our decisions are informed by the firm’s performance, external market conditions and the investments we make in response to client demand, such as our recent commitment to honouring all graduate roles for the year ahead.”
This comes after the Financial Reporting Council (FRC) ‘s boss Sir Jan du Plessis called on all four major accountancy firms, PwC, KPMG, Deloitte and EY, to give staff a pay rise.
He said there had been a “significant increase in profitability” and that they had the means to pay junior staff more, if they wanted to attract talent.
There have also been concerns that increasing us of artificial intelligence could lead to job losses. PwC said it had invested more than $1bn in AI tools earlier in the year, while insisting people wouldn’t necessarily lose their roles.
Fellow Big Four firm KPMG released a report this week, saying generative AI could lead to a productivity boost of $31bn, but there are concerns about some industries needing less people, such auditing and in the media.
When asked if they’d be freezing pay for junior staff, EY told City A.M: “We have not yet announced the results of our UK annual pay review. This is usually communicated to our people in the Autumn.”
All four accountancy firms have been approached for comment, as have the FRC.