Sunday, January 29, 2023

Goldman Sachs will begin laying off thousands of employees

Goldman Sachs Group (GS.N) will start cutting thousands of jobs across the firm from Wednesday, two sources familiar with the move said, as it prepares for a tough economic environment in the year ahead. The job cuts are expected to be just over 3,000, one of the sources said, but the final number is yet to be determined.

The sources could not be named as the information was not yet publicly disclosed. Goldman Sachs declined to comment.  Goldman will cut around 3,200 jobs. Goldman had 49,100 workers at the end of the third quarter, after hiring heavily during the coronavirus outbreak.

Hundreds of jobs are also likely to be reduced from Goldman Sachs’ loss-making consumer business after it scaled back plans for its direct-to-consumer unit Marcus, the sources said.

The bank’s chief executive David Solomon sent a year-end voice memo to staff warning of a headcount reduction in the first half of January, two separate sources said. Goldman Sachs declined to comment on the memo. The job cuts come ahead of the bank’s annual bonus payments which are usually delivered later in January and are expected to be down about 40%.

In September, the bank resumed its yearly job-cutting program, which had been put on hold for two years due to the epidemic. Every year, the Wall Street behemoth reduces its workforce by 1% to 5%. These latest layoffs are on top of the previous ones.

According to Dealogic statistics, investment banking fees virtually halved in 2022, with banks earning $77 billion globally, down from $132.3 billion the previous year.