Fired Street – Big Banks Handing Out Even Bigger Layoffs!
Goldman Sachs is set to lay off up to 8% of its employees in January, the largest round of cuts on Wall Street. Preparing for a challenging business environment, the bank will lay off workers from all its divisions. Other firms may follow suit as the subdued capital markets environment persists. According to Wall Street recruiter Mike Karp, “Many firms will have to go back to the drawing board and right-size their organizations, not just Goldman. Firms over-hired, and now they will have to over-fire, too.” The cuts at Goldman Sachs will impact underperformers and those working in consumer businesses that the bank is de-emphasizing. However, Goldman Sachs CEO David Solomon has indicated that the bank is looking to control expenses and is implementing certain expense mitigation plans. The move comes as Wall Street faces a slowdown in revenue after a period of growth in deals and hiring.
Even earlier in July, the investment bank industry warned that it might slow its hiring and reduce expenses. Indeed, it’s not just Goldman, with Global banks, including Morgan Stanley and Citigroup, having been forced to reduce their workforces in recent months. The boom in Wall Street deal-making has been disrupted by high-interest rates, tensions between the United States and China, the war between Russia and Ukraine, and rising inflation.
What do you think about the rising layoffs? And does it tell us anything new?
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I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.
