Why?Ģ0 saw an unprecedented wave of exits from the industry – these exits should stabilize as utilization comes back to historical norms. …which will Increase Competition for Open Roles in 2023ĭecreased utilization and a loosening labor market will lead to less open roles and slower salary growth this year. Utilization has decreased at some firms from the all-time highs we saw in 2021 and early 2022. …and the Staff are Getting Less Busy…Īs the last two years of frenetic hiring catches up with the demand for services, overall consultant utilization has plateaued. At the same time, while the rate of growth for boutique firms increased YoY, the proliferation of in-house strategy groups at large corporations continues to limit the growth of a fragmented market of boutique players. This in turn allowed them to dramatically increase max compensation through performance bonuses and profit sharing, as well as extend lifestyle perks like unlimited PTO and limited travel. What do you get when you put it all together? The Gap Between Top Firms and the Rest is Widening…Įstablished consulting firms drove a lion’s share of the overall industry growth through organic and inorganic means. Strategy firms acquired specialist players to continue to move further downstream into supply chain, sustainability, digital, and implementation work (e.g., Bain acquiring supply chain consultancy Proxima). Large firms acquired boutique strategy houses in lieu of (or in addition to) organically building their own (e.g., AlixPartners acquiring Galt & Co.). The M&A activity revealed two basic patterns. We believe the dramatic increase in pre-MBA salaries is a forerunner to this playing out in the industry over the next 10-15 years. The potential result? Without the traditional increase in pricing power that industry consolidation brings, we may see firms begin to shrink project teams or prioritize the hiring of cheaper pre-MBA talent in the next decade. Still, there is only so much that firms can cut, and salaries keep rising (as you’ll see). So far, margins have been protected by a decrease in operational costs (i.e., smaller office space, less travel). Future margins are at risk as firms continue to raise salaries without a commensurate rise in project rates. However, this growth is not without potential peril. ![]() This led to record revenue for many consulting firms and a continued wave of M&A activity, leading to double-digit industry growth. 2022 saw firms grapple with the tightest global labor market in decades as demand for management consulting services remained strong. Now, let’s get into some of the consulting salary trends we identified this year. Already have an interview? Let’s execute a personalized prep plan through 1:1 coaching. Work with us through our editing package – we’ll rewrite your resume and build you a networking strategy. Nervous about the consulting recruiting process, yet convinced the career path is right for you? We can help (and do help thousands of candidates per year). Put it all together, on top of the professional development and exit opportunities, and that’s a pretty great value proposition for consulting. How? Travel is down, utilization is coming down from pre-pandemic highs, and salaries have soared. Comp is on the rise, and the lifestyle is actually better than it was 5-10 years ago. What does this mean for you? If you can make it through the gauntlet that is consulting recruiting, it’s a great time to break into the industry. It’s a big year for the consulting industry as well, as firms increased starting salaries substantially from 2022. ![]() This is a big year: Charles III will be coronated as King of the United Kingdom and other Commonwealth realms, India is projected to surpass China as the world’s most populous country, the FIFA Women’s World Cup takes place in Australia & New Zealand, and the Cricket World Cup takes place in India. Welcome to 2023, and our updated management consulting salaries report! ![]() 2023 Management Consulting Salaries Overview
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