(Bloomberg) -- Accenture Plc surged after saying it will cut 19,000 jobs — about 2.5% of its workforce — over the next 18 months, one of the largest rounds of dismissals in a consultancy sector battling strong economic headwinds.

The shares climbed as much as 8.4% in New York following the announcement, the biggest intraday gain since December 2021. The company said it expects to incur $1.2 billion in employee severance and other personnel costs, and will spend an extra $300 million on office space consolidation. The job cuts come after Accenture hired 39,000 people over the past year, according to a company filing.   

The move is the latest sign of the economic uncertainty impacting consultancy, tech and finance firms that has led many to lay off staff and introduce hiring freezes. Last month, McKinsey & Co. said it plans to ax 2,000 jobs following a rapid expansion of headcount over the past decade, while KPMG announced it had cut almost 700 professionals from its US advisory practice amid slowing demand. Others, such as EY, are trimming their hiring targets by thousands. 

“The pandemic created a lot of consulting opportunities that the firms couldn’t give up. Hence the hiring binge,” said Tom Rodenhauser, managing partner of Kennedy Research Reports, which tracks the consulting sector. “Now we’re seeing a correction. We’ll probably see a few more firms doing the same in the coming months.”

Read More: Massive Global Layoffs Reverberate Beyond Tech Sector

Accenture’s announcement dwarfs the job cuts of its peers. Over half of the eliminations will affect people in non-billable corporate functions including human resources, financial and legal departments. The move comes comes just 16 months after Accenture pledged to create 3,000 tech jobs in the UK, including half outside of London, over three years. A spokesman for the company said this commitment still stands.

The size of the staff reduction reflects Accenture’s close ties to the reeling tech industry, according to Rodenhauser. 

“Accenture has a dominant position in that sector as a provider, so it’s natural that the largest provider would feel the effects more as the sector slows,” he said.

Chief Executive Officer Julie Sweet said the company is “taking steps to lower our costs in fiscal year 2024 and beyond, while continuing to invest in our business and our people.”

The company also trimmed the top end of its forecast, with revenue expected to grow between 8% and 10% this fiscal year, down from a previous range of 8% to 11%. Bookings rose to a record $22.1 billion in the second quarter, beating estimates, a 13% increase from the same period last year.

Accenture Strong Bookings Growth Defies Economic Weakness: React

Better-than-expected bookings were “a surprise given the weak economic climate,” Bloomberg Intelligence analysts said in a report.

(Updates with details on previous hiring in second paragraph, forecast in ninth.)

©2023 Bloomberg L.P.