FT had an interesting story yesterday about a situation across the pond: average BDO UK partner pay fell 15 percent to £647,000 (USD$794k) because a hiring spree took a bite out of profits. Last year, BDO UK partners walked away with more than even EY and KPMG partners. They aren’t worried about it though, the plan is to make sure they have enough people on payroll before the economy really takes a dump. “This is part of our longer term strategy to say, ‘let’s carry on investing in these people and do all we can to retain them’ so that when we do come to the other side of this recession, we’ve got enough people to help us start growing more profitably,” said Paul Eagland, managing partner. He told FT the hiring drive was inspired in part by employee feedback they received on work-life balance (or rather lack thereof).
Recent recruiting efforts added about 1,000 people to the firm headcount.
BDO said the average number of hours billed to clients by its auditors and advisers fell 7 per cent to about 1,250 a year. The firm spent £70mn on recruitment, technology and promoting more than one-third of its staff.
As a result, profits fell to £187mn in the 12 months to July 1, down from £203mn a year earlier, despite an 11 per cent increase in revenues driven by strong demand for advice in areas such as corporate transactions.
“We’ve spread the load over more people,” said Eagland. “People are . . . having to spend less time at work than they did the year before.”
With grumblings of hiring freezes and delayed start dates making their way through the professional services rumor mill, it’s probably a good idea BDO got a jump on things.
BDO partners take pay cut as recruitment drive hits profits [Financial Times]
