The Consulting Crash Is Coming

From the Dossier

Entry 17 of 26. Section B: Industry-wide structural erosion. Back to the Dossier

Summary

Joe Nocera argues that two forces, Trump administration cuts to federal consulting contracts and AI’s erosion of the billable-hour model, are converging on McKinsey, Bain, BCG, and the Big Four simultaneously. Nocera traces the industry’s value proposition back to the 1980s merger boom. Peter Thiel is quoted: “If the consulting business was a stock, I’d be shorting it right now”.

Source description

A well-reported argument. Nocera ties the 1980s merger boom to functions consultants then performed (staff cuts, cultural integration) that justified their fees, and argues the industry kept scaling after that justification evaporated.

Credibility assessment

The piece is polemical by design. Under Rule 4, the historical argument (consulting’s utility diminished by the early 1990s) is an inductive claim supported by case-study reasoning, appropriate for the claim’s scope. Thiel’s quote is a matter of public record. The independence rating is Medium-High due to the opinion format and single-author nature.