Ernst & Young predicts growth fall

ERNST & Young expects its revenue growth in China to drop to about 20 percent next year after years of 30 to 40 percent growth, its Far East chairman told Shanghai Daily yesterday.

The accounting firm doesn't rule out plans to slash salaries and cut jobs to control human resources costs if the economic slowdown worsens, said David Sun yesterday in Shanghai.

"The big-four accounting firms' turnover rate is relatively high when compared with other industries, even when there is no financial meltdown," Sun said. "We will endeavor to maintain our talents but the possibility of layoffs and package cuts can't be ruled out in the future.

"Our long-term commitment to the Chinese market is unchanged but our business here is not immune from the global financial tsunami. No industry is," he said.

The accounting firm will endeavor to grow 20 percent in China next year and will be "happy" if that target is reached, said Sun.

Ernst & Young reported a 41-percent revenue growth in China in the last fiscal year, riding on China's booming economy.

The Chinese mainland, Hong Kong and Macau businesses posted faster revenue growth than the Ernst & Young global network, delivering strong growth across all service lines.

Sun is a member of the accounting firm's global executive board, based in Hong Kong. He was in Shanghai yesterday for its Entrepreneur of the Year 2008 ceremony.