KPMG scales back Manchester office space as it shifts to hybrid working

Investing

KPMG UK has told staff it will shut its Manchester Technology Centre because a shift to hybrid working after the pandemic means it will need less office space.

The Big Four consultancy is reducing its physical presence in the city less than two years after moving 100 digital specialists into the 12,000 sq ft hub as part of a “major investment” in the region.

The closure of the Manchester site is the latest example of a Big Four consultancy decreasing its office space as employers cut costs and adapt to a hybrid working model.

KPMG announced in February that it would invest £44m in technology and reconfigure its offices to include more meeting areas, part of a permanent shift towards employees splitting their time between home and the office.

In an email to staff on Wednesday seen by the Financial Times, KPMG said: “When considering the plan for the future when hybrid working is fully up and running, it’s clear that we will not need as much space as we currently have, as we will be splitting our time across client sites, third party sites, at home, and KPMG offices.”

The memo was from Dave Yip, connected technology partner, and Warren Middleton, Manchester office senior partner.

Staff at the Manchester Technology Centre will move to KPMG’s main office in the city, One St Peter’s Square, which will be refitted to “support collaboration and project style working”, they added. There would be no job losses in Manchester, where the firm employs 1,200 people, KPMG said.

The firm planned to notify its landlord that it would not renew its lease at the Manchester Technology Centre and would shortly begin moving equipment to St Peter’s Square, Yip and Middleton said.

Staff, who have worked exclusively from home for a year, were told that KPMG’s facilities team would arrange to send them any personal possessions left in the office.

KPMG said it planned to retain a presence in all its regional markets but was considering its office footprint across the UK. The lease on its Sheffield sales office also expired during the pandemic and the firm was seeking a new location for client meetings, it said.

KPMG and its Big Four rivals have several technology and business process offices in the UK regions. They include EY’s Newcastle office and PwC and Deloitte’s Belfast operations.

KPMG’s rivals are also adapting to the rise in working from home following the pandemic.

Deloitte has said it expects hybrid working will allow its UK staff to work “where, when and how they wish to”. The firm closed four of its offices around the UK and asked 500 staff to move to full-time remote working.

PwC has told its accountants and consultants in the UK that they will spend an average of two to three days a week in the office after the pandemic ends.

KPMG UK’s new chief executive, Jon Holt, led the firm’s Manchester office from 2013 to 2017.

He took over last week after Bill Michael resigned in February following a staff backlash when he told them to “stop moaning” about working conditions during the pandemic.

KPMG’s revenues slipped 4 per cent to £2.3bn in the 12 months to September but partners took an 11 per cent pay cut as the cost of responding to the pandemic dented profits.

Additional reporting by Andy Bounds

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