The latest Crain’s New York business list of the Top 25 Accounting firms in the New York area shows a significant decline in the number of accounting professionals working at these firms -- 1,929 people, or 7 percent, versus year-earlier levels. Together, the Top 25 firms employed about 23,000 professionals as of June 30, 2009 down from 25,000 in June 2008. Crain’s research shows a headcount decline in 16 firms, with only 9 showing an increase.
Unemployment in New York City is higher than the national level and continues to go up due to continuing layoffs on Wall Street and the ripple effect of these job losses, according to a State Department of Labor report. The unemployment rate in August reached 10.3 percent, up from 9.5 percent in July. The state unemployment rate, including New York City, is 9 percent.
The Big Four firms, which account for two-thirds of the accounting professionals employed in the area, showed a decline in professional headcount of 1,476 in one year. KPMG, the largest accounting employer in New York, employed 681 fewer professionals or 13 percent. Deloitte, which ranks fourth, showed a decline of 378 professionals, or 11 percent. PricewaterhouseCoopers employed 350 fewer professionals, a decline of over 9 percent, while E&Y showed only 67 fewer professionals, 1.6 percent.
Smaller New York City firms with declines in the number of professionals of more than 10 percent include CBIZ Mahoney Cohen & MHM Mahoney Cohen CPAs, which reported a loss of 53 professionals and Weiser, ranked 15 on Craig’s list, which showed a decline of 42 professionals.
The biggest increase in numbers of professionals was at Eisner -- 120 professionals, or 25 percent. Two other firms on the Top 25 list increased their rosters by more than 10 percent: Marks Paneth & Shron added 47 professionals, and Rosen Seymour Shapss Martin & Co. added 20 professionals.
In addition to the effects of the economic downturn, one factor contributing to layoffs by public accounting firms nationwide in 2009 has been the decline in revenue from Sarbanes-Oxley compliance work, said Barry Epstein, a partner at the Chicago accounting firm Russell Novak and Co., according to a Hartford Business Journal report. Epstein made his comments when
Deloitte announced in August 2008 that it would lay off approximately 2 percent of its staff, or 800 professionals, because of lower revenue projections. Epstein said that much of the compliance work for Sarbanes-Oxley support had been completed, and federal regulators adopted simpler rules that required less work by outside accountants.
Deloitte also lost two major New York-based clients when Bear Stearns was bought by JP Morgan Chase, and Merrill Lynch was purchased by Bank of America. E&Y audits Lehman Brothers Inc.