The Consulting Crisis at McKinsey, BCG & Bain: What's Actually Going On

Job cuts across all the major firms. Start dates getting delayed for new joiners. An armada of junior consultants stuck on the beach. Promotions postponed across every level. If you've been following the news or the discussions on LinkedIn over the past two years, you'd think the end of consulting is near.

So is that actually the case?

In short, no — but the current crisis in consulting isn't exactly fun, and it's lasted longer than anyone expected. We spent 6+ years each at McKinsey before moving into corporate roles, and we've stayed plugged into what's happening at the firms through our network. In this post, we'll walk you through what actually happened, why it happened, and what it means if you're considering a consulting career right now.

Some Context: Consulting Is a Cyclical Industry

Before we dive in, it's worth remembering that consulting has always been a cyclical industry. When the economy is doing well, companies have big consulting budgets and pay top firms generously to help them grow, restructure, and transform. When the economy slows, those same companies cut back on external advisors first, because consultants are an easy line item to defer.

This boom-and-bust pattern is normal. What's not normal is how the current downturn started — and why it's been worse than previous cycles.

Pre-COVID: The Industry Was Booming

Let's rewind to early 2020. The consulting industry was on fire. The economy was strong, new projects were launched constantly, and a junior consultant was almost never on the beach because everything was so busy. McKinsey, BCG, and Bain were all growing aggressively, and the biggest constraint was finding enough talented people to staff all the work.

Then COVID hit.

Companies had to partially shut down or move to work-from-home overnight, which nobody was actually prepared for. We watched clients carry their desktop PCs out of the office because their company simply didn't own enough laptops. Quite funny to see a C-level executive trying to fit half his office setup into a Porsche. Tough life, we guess.

Consulting projects were halted everywhere. No company in their right mind started a new strategy project unless it was absolutely critical. For a few months, things looked dire.

And then, to the surprise of just about everyone, the economy bounced back faster than anyone predicted — and consulting demand exploded.

So much had changed in the corporate world in such a short time. Hybrid working models. Distribution channels suddenly shifting toward e-commerce. Disrupted supply chains. New cybersecurity needs. A wave of digital transformation projects. And all of that change meant that consulting firms had their hands full helping clients adjust to the new normal.

The Hiring Spree

From mid-2020 until summer 2022, the consulting industry kept growing and posted record revenues. Demand was so strong that the firms couldn't find enough people to staff all the work. McKinsey, BCG, and Bain raised their recruiting targets aggressively. They'd never publicly admit to lowering the bar, but somehow they always managed to hit those targets.

Here's something most candidates don't realize about how MBB hiring works: offers are extended way in advance. It's possible for someone with an entire year of university left to already have an offer in their pocket. And the average gap between handing out an offer and the new joiner actually starting on the job is around six months. So consulting firms are essentially hiring blind — making bets about how busy they'll be six to twelve months in the future.

If you think about it, being optimistic about future business is actually the rational thing to do. Hiring someone you can't immediately staff costs the firm a few thousand dollars a week. But not being able to staff a project because you don't have the people available costs the firm six figures in lost revenue. The math of the opportunity cost makes erring on the side of overhiring the smart play — as long as the music keeps playing.

The Slowdown

And then, towards the end of 2022, the unthinkable happened. The economy slowed down.

It wasn't a major recession in the technical sense. It was more of a multitude of discouraging factors hitting at once: the ongoing war in Europe, the energy crisis, persistent inflation, a tight labor market, and rising interest rates. Many of these factors were interlinked. The result was that business confidence dropped to its lowest level in 20 years, with the only exceptions being the 2008 financial crisis and the height of COVID itself.

Technically, no recession. But companies became extremely reluctant to launch new consulting projects. And by mid-2023, consulting demand had dried up almost completely.

The problem is, the firms had already made their hiring bets six months earlier, when the music was still playing. Thousands of new joiners walked through the door of MBB offices in 2023 — exactly the same year demand collapsed.

The Six Consequences

What happens when a firm has too many consultants and too few projects? Pretty much exactly what you'd expect, and we saw all of it happening in real time. Here are the six things that played out across MBB over the course of 2023 and 2024.

1. Junior consultants on the beach for months

Many new joiners were on the beach right from day one — sometimes spending months without being staffed on their first project. That's extremely frustrating, and it can take a real mental toll on you. You're a super motivated, high-performing graduate, you've just survived the toughest interview process in the corporate world, and all you get to do is sit in the office and write proposals with no client interaction.

2. Junior consultants failing to learn the consulting toolkit

A direct consequence of being on the beach is that young consultants don't develop the consulting toolkit — the PowerPoint, Excel, project management, and client interaction skills that turn a junior consultant into a senior one. We have personally worked with junior colleagues who had a tenure of more than a year and had never built a proper Excel model. That's a serious problem for their career development, and the firm will eventually hold it against them at performance review time — even though it's not really their fault.

3. Much harder to get the projects you actually want

Even senior consultants couldn't be picky during the slowdown. You're passionate about sustainability and renewable energy? Well, if there are zero projects in that space right now, you might find yourself working for an insurance client on an IT transformation. You can try to avoid the projects you don't want, but at a certain point, you have to accept what you're being offered — or risk getting pushed out.

4. Promotions delayed across the board

How do you assess the skills of a consultant who only had three months of project work in the entire year, and spent the rest of the time on the beach? You don't, really. So promotions get delayed. And of course, delaying promotions also conveniently saves the firm money. Two birds, one stone.

5. Performance appraisals getting harsher

The regular performance reviews became noticeably tougher. More people than usual received bad reviews and were "encouraged" to leave. The intent is obvious: if you've overhired and there are too many consultants for too few projects, you want to thin the ranks — and ideally keep only the strong performers. While that's logical, it's also frustrating, because even strong performers suffer. Firms become reluctant to hand out top ratings, and those top ratings are exactly what trigger promotions and meaningful bonuses.

6. Even exit opportunities got more competitive

Normally, exiting MBB is one of the easier moves in your career — the brand opens doors, headhunters are constantly reaching out, and you have your pick of corporate strategy roles. But when many consultants are trying to exit at the same time, suddenly there are five MBB consultants interviewing for the same job. The competition that used to be on the way into consulting is now on the way out.

Where We Are Now in 2026

The downturn that started in 2023 didn't snap back. It dragged through 2024 and into 2025, and the firms eventually moved from quietly counseling people out to publicly announcing layoffs.

McKinsey was the most visible. The firm cut 2,000 jobs in 2023 under "Project Magnolia," followed by additional job cuts in 2024 targeting specialists in design, data engineering, and software. Then in late 2025, McKinsey signaled potential further cuts of nearly 10% of its non-client-facing staff. The firm's headcount, which had ballooned past 45,000 during the hiring spree, has been brought back down to around 40,000.

The other firms followed similar patterns. Bain, Deloitte, KPMG, and Accenture have all laid off workers in 2025, and PwC and EY pushed through pay cuts and start-date deferrals. The one notable exception is BCG, which has been growing its headcount — but with a heavy tilt toward AI and tech specialists rather than generalist consultants.

That last point matters. The story isn't just "consulting is shrinking." It's also "consulting is being reshaped." A meaningful share of the new hiring at MBB firms is now going into AI-focused practice areas rather than the traditional generalist track. For BCG specifically, the firm's generative AI unit BCGX now consists of over 3,000 employees, and a substantial share of recent hiring has been in technical roles.

For candidates considering MBB right now, the practical implication is that the hiring profile is shifting. Generalist hiring is more selective than it was during the post-COVID boom, and technical and AI backgrounds are getting a meaningful boost.

So Will Consulting Survive?

It's always hard to give predictions, but we highly doubt this is the end of consulting as we know it. The world is constantly changing, and there's always demand for outside perspective, deep industry expertise, and the ability to mobilize a team quickly. Even in the middle of this slump, there are still thousands of MBB projects running right now. The issue isn't that demand has gone to zero — it's that there are temporarily too many consultants for too few projects.

For candidates, this temporary mismatch shouldn't be a reason to give up on a consulting career. If you're driven, willing to go the extra mile, and you find the core group of people you love working with, you'll find projects, you'll learn a lot, you'll have an impact, and you'll find stellar exit opportunities. The fundamentals of why consulting is valuable — to the consultants who do it and to the clients who pay for it — haven't changed.

What has changed is the bar to get in. Recruiting is more selective right now than it was three years ago. The firms aren't going to publicly admit they raised the standards, but the candidates we're seeing get offers in 2026 are noticeably stronger than the cohorts who got hired at the peak of the spree. That makes preparation more important than ever.

The Bottom Line

The crisis is real, but it's a cyclical correction, not an existential one. Consulting will survive. McKinsey, BCG, and Bain will survive. The cohort that gets hired through the back end of this downturn will probably end up being one of the strongest in years — because the firms have been forced to be more selective, not less.

If you're preparing for MBB interviews right now, the toughest part isn't the market — it's the case interview itself. Our Case Interview Mastery course on Udemy walks you through 7 McKinsey-style cases with detailed solutions, taught by us, two former McKinsey interviewers. It's the same content we wish we'd had when we were preparing.

Related posts you might find useful:

• The Up-or-Out Principle at McKinsey, BCG & Bain

• Why Consultants Quit McKinsey, BCG & Bain

• Project Staffing at McKinsey, BCG & Bain

• Consulting Salary at McKinsey, BCG & Bain

• GenAI in Consulting: Is McKinsey's AI Tool Lilli the End of Consulting?

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