Consulting firms are no longer the attraction they once were

• Consulting firms have experienced increased employee turnover following layoffs and delayed start dates.
• The industry continues to see high application rates, but its allure has waned for some workers.
• Some of the work can be “super demoralizing”, a former consultant told BI.

For a young woman who joined Accenture straight out of college, consulting was a crash course in the corporate world. She became proficient with tools like Excel and Tableau and learned how to talk to executives.

However, during the four years spent in the company, tired of the rote nature of her work. Plus, she said, she was often brought in just to validate the client’s own thinking.

“A lot of junior consultants don’t realize how many of these projects are already what I call ‘predestined,'” the woman, who requested anonymity so as not to jeopardize her career prospects, told Business Insider. “There’s a final destination, but you have to go through the motions, and that’s just super demoralizing for the people on the team.”

For decades, business and MBA students sought out consulting because the work was high-paying and prestigious. But a few tough years in the business, which included layoffs and delayed start dates for new hires, have pushed some consultants — even some who have been in the business a while — to reconsider a business once synonymous with generous accounts expenses and stability. .

The lure of other industries

The declining attractiveness of the consulting industry is most evident in the number of employees who leave.

Almost every major consulting firm has seen more employees leave than join in the past two years, said Jason Saltzman, chief growth officer at Live Data Technologies, which collect employment data in real time.

And those who left are more experienced than those who left in past years. The tenure of departing consultants has increased by 7% over the past 18 months compared to the average over the previous decade.

One advantage of consulting was that veterans could often parachute into adjacent industries or possibly land important roles with former clients. Now, some departing workers are lured by the lure of the tech industry. Five former consultants told BI they had moved on to startups or venture capital – after years in the business consulting firms—in hopes of finding more fulfilling work.

But perhaps an even more worrying trend for consulting firms is that younger consultants are starting to see them as a stepping stone to something better, rather than a prestigious lifelong career.

“My parents are both entrepreneurs, so I have deep respect for founders who take big risks to bring their ideas to life,” Jyothi Vallurupalli, a former McKinsey consultant who is now an investor at the venture firm, told BI Lightbank. “When I left consulting, I realized that VC would allow me to collaborate with passionate founders from various industries early on in their journeys, and I saw this as an opportunity to help build something meaningful.”

After leaving McKinsey in 2023, Ezra Gershanok founded subletting startup Ohana. It has since launched a four-week internship for students interested in consulting.

“When I was an interviewer at McKinsey, one of the pillars that they would hire for was entrepreneurship,” Gershanok said. Now, he and his team market these internships to students as “here’s how you can tick that box in the interview process.” But, he said, many of the interns ultimately want to stay at Ohana or seek other jobs for the startup.

Gorick Ng, a career counselor at Harvard University and author of “The Unspoken Rules,” told BI that he has seen an increase in the number of students who do internships at consulting firms but choose not to return for a job full time.

He said some students will spend most of their undergraduate years fishing for an internship at a big firm — preparing for interviews, attending information sessions, having coffee talks and networking with alumni. – only to find out once they got the internship that the job wasn’t for them.

Ng said many students soon realize that the thrill of landing a prestigious job often fades. What matters more is whether the work is attractive. “Is this a day-to-day that I would find fulfilling, and is it something I can really see myself doing long-term?” Ng said.

A tough time for consulting firms

Even consultants who have been at it for a while are leaving the industry.

Matt Sternberg is COO at Accelant, a startup that connects insurance firms with financial institutions. Before joining the company in 2023, Sternberg spent a decade at Boston Consulting Group, a leading industry firm. He left the firm as managing director and partner.

Sternberg told BI that he’s heard from former colleagues — including people who were partners longer than he was — who wonder about life beyond consulting. It’s different from when he left in 2022, when there was a pandemic-fueled boom in consulting work. Now, people are “outward looking” more than they were in previous years, he said.

Sternberg said he felt his former industry was cutting staff too deeply in 2023 during a “really challenging year” for the business.

“I worry that they’ve started to erode their culture,” he said, adding that some firms have withdrawn benefits.

A recent post on Reddit from someone who wrote that he works for a Big Four consultancy in London said that one of the reasons people might be tempted to leave the industry is that working remotely can make it harder to connect with colleagues – the main thing that made the job bearable, the poster said.

“Constantly typing in front of my screen on the kitchen table in a shared apartment is more depressing than 1,000 cringeworthy pizza parties,” the person wrote. A reduction in perks, such as flights to client offices and expensed meals, also makes the job less attractive.

Consulting is not the launch pad it once was

Consulting hasn’t lost its allure for everyone, of course.

This is clear from the number of requests received by large firms. A McKinsey spokesperson told BI in July that the firm plans to hire less than 1% of those who apply. The company receives approximately 1 million resumes each year.

Ernst & Young received more than 4 million applications in the past year and hired about 140,000 people, Irmgard Naudin ten Cate, EY’s global head of talent attraction and acquisition, told BI in July.

However, even though many people try to add a big name firm to their resume, some outside the industry they are now less interested in attracting consultants of old.

Atli Thorkelsson, who helps startups recruit at venture capital firm Redpoint Ventures, told BI that founders often looked to people with consulting experience for generalist roles, such as a chief of staff or someone who it could be a reconciliation board for a startup CEO who might have a good idea but not much business experience.

But lately, Thorkelsson said, he’s seeing “less enthusiasm” from founders for workers consulting on their resumes than there was in 2017 to 2018.

Even as the lure of the industry fades, giving up a lucrative job that can be hard to come by isn’t necessarily easy. “When I left consulting, consulting was really all the rage. It’s like high prestige, high salary,” said the former Accenture consultant. “That part was scary, to be honest.”

Have something to share about what you see in consulting? Business Insider would like to hear from you. Email our consulting team from a device that doesn’t work at [email protected] with your story or ask for one of our reporter’s signal numbers.