EY’s Pay Rise Reflects a Changing Partnership Economy

EY’s latest results tell a familiar story of contrasts: modest revenue growth, a tougher market for consulting, and yet a near-double-digit rise in partner pay. Average payouts to UK partners climbed 9% to £787,000 for the year, closing in on the firm’s pre-pandemic record and keeping EY in step with its peers’ upward trend. Deloitte partners still lead the table at just over £1m, followed by PwC at £865,000 and KPMG at £816,000.

On paper, the numbers look reassuring. A 2% rise in fee income to £3.8bn and a 3% increase in distributable profits suggest steady footing in an uncertain economy. Yet beneath that stability lies a deeper question: how sustainable is the partnership model’s reward structure when costs rise and headcount tightens?

Pay resilience in a slowing market

The latest round of results from the Big Four firms reflects a shift from the post-pandemic boom to a more restrained cycle. Demand for audit and tax services has held firm, but consulting – long the driver of double-digit growth – has softened across the board. EY’s advisory revenues dropped 6% over the year, echoing declines at Deloitte and PwC. Clients are deferring transformation projects and seeking more cost-efficient engagements.

Despite this, partner pay remains buoyant. EY’s UK partners collectively took home nearly £700m in distributable profits, even after a wave of redundancies and partner exits earlier in the year. The pattern is not unique to EY. Across the Big Four, cuts to staff and consolidation of non-core services have quietly shored up margins. Partner earnings, as a result, have become a more accurate reflection of cost control than of top-line expansion.

For many firms, maintaining high partner rewards serves a strategic purpose. Profit shares remain central to retention and recruitment, particularly as global networks compete for senior leadership talent. Yet this also places the partnership model under public scrutiny at a time when policymakers are eyeing LLPs for higher taxation. The Treasury’s consideration of national insurance on partnership income, if enacted, could push effective tax rates for partners beyond 50%, bringing fresh pressure to the model’s financial equilibrium.

The divergence of business lines

EY’s results underline the uneven performance across service lines. Assurance grew 3%, tax rose 5%, and the firm’s deals advisory arm rebounded strongly with a 10% increase. The consulting division, however, remains a drag, with demand falling for the second consecutive year. This pattern is consistent across the Big Four and mirrors a broader rebalancing in the professional services market, where AI adoption and client insourcing are eroding the need for large-scale consulting teams.

In this context, technology investment is becoming the next battleground for growth. EY’s global commitment of $1bn to audit and AI tools – alongside its partnership with NVIDIA to develop the EY.ai Agentic Platform – reflects a pivot towards long-term efficiency rather than short-term billing. Automation may not boost revenues immediately, but it offers the potential to preserve margins in an environment where clients expect more for less.

A shifting partnership economy

The current cycle may mark the beginning of a structural change in how accounting partnerships operate. The traditional formula – growth through headcount, revenue expansion through consulting, and reward through equity share – is under strain. AI-driven efficiency and client expectations for integrated digital services are forcing firms to do more with fewer people. Reductions in graduate intakes across the Big Four illustrate how the entry-level talent pipeline is being reshaped.

At the same time, partner payouts are becoming an increasingly political signal. Against a backdrop of public sector pay restraint and calls for higher taxation on professional services, rising partner profits risk fuelling debate about fairness and accountability. For firms, this raises a delicate balancing act between rewarding senior partners and demonstrating societal value.

The optics of success

Partner pay rises make headlines because they reflect confidence in leadership, profitability of the partnership model, and, to some extent, the success of cost discipline. But they also expose the widening gap between partners and the rest of the workforce. For younger professionals facing slower promotion paths, AI displacement, and stagnant pay, the sight of near-record partner earnings can be dispiriting.

That tension is becoming harder to ignore. Even as Big Four firms emphasise culture, inclusion, and innovation, the reality remains that financial rewards are heavily concentrated at the top. Whether this structure continues to attract new generations of talent will depend on whether the firms can link profitability to broader opportunity, not just to partner distributions.