Deloitte announces ‘modest’ layoffs in government consultants amid federal spending cuts

Deloitte LLP is planning to lay off employees on its government consulting team, according to people familiar with a call between executives and workers on Thursday.

It’s the latest sign of the far-reaching ramifications of the Trump administration’s sweeping cost-cutting efforts, which have swept up the broader ecosystem of businesses that support the federal government.

Also Read: Is this American adult star pretending to date a Bengali boy for Indian Citizenship? Internet is confused

Deloitte says it is making ‘modest’ layoffs

It was not immediately clear how many people Deloitte plans to lay off and where else in the business it is cutting, but the company described the move as modest.

“Overall demand for Deloitte’s services remains strong,” Deloitte spokesperson Jonathan Gandal said in a statement. “We are taking modest personnel actions based on moderating growth in certain areas, our government clients’ evolving needs, and low levels of voluntary attrition.”

One participant in the call on Thursday said the layoffs would begin this month for consultants in Deloitte’s Government and Public Service division. Many employees in that unit have already been pulled off projects because the government cut their funding, including for the US Agency for International Development, which the Trump administration shut down. The decision to dismantle USAID is being challenged in court.

Deloitte has been hardest hit by government spending cuts in comparison to other government consulting giants, Bloomberg News previously reported. The Government Services Administration, or GSA, has initiated a massive effort to cut down on consulting contracts across the federal government. Deloitte brought in $3.2 billion from government contracts last year.

The Wall Street Journal first reported Deloitte’s planned layoffs.

Also Read: Is this American adult star pretending to date a Bengali boy for Indian Citizenship? Internet is confused

Other federal consulting firms under GSA fire

The GSA in March announced it was escalating its inquiry into federal consultancies, which also includes Booz Allen Hamilton Holding Corp. and Accenture Plc, warning the firms they must explain what they do in plain language rather than “jargon or gobbledygook.”

In a letter to the top 10 highest-paid consulting firms with government contracts, GSA’s new top procurement official requested a trove of information on the companies’ billions of dollars in government contracts, as well as how they intend to help “reduce or eliminate spend,” according to a copy of the letter obtained by Bloomberg News. Deloitte has agreed to cut some of their contracts, and is actively negotiating with GSA on others.

Other firms in GSA’s crosshairs include International Business Machines Corp., General Dynamics Corp., Leidos Holdings Inc., Guidehouse LLP, HII Mission Technologies Corp., and CGI Federal.