Goldman Sachs will lay off 4,000 employees — or 8% of its workforce — in January
Wall Street giant Goldman Sachs plans to lay off 4,000 “underperforming” employees in January as it is hit by the severe economic crisis.
Up to 8 percent of the bank’s workforce could be laid off after the firm asked managers to draw up a list of “low performers,” people familiar with the matter told Semafor.
The sources said the layoffs would affect all areas of the bank and would take place around January, the same time bonuses are normally distributed.
The layoffs would see the company shedding its 49,1000 employees for the first time since 2019 as it halted the usual 2 to 5 percent annual cuts during the pandemic.
It comes at a turbulent year for the investment bank, whose share price has fallen more than 12 percent since December 2021.
Goldman Sachs is the latest major employer trying to cut office jobs after PepsiCo announced last week it would lay off hundreds in New York, Texas and Chicago.
Goldman Sachs plans to lay off about 4,000 of its 49,100 employees, an 8 percent cut amid a harsh economic downturn
The company has seen a growing workforce since it was acquired by CEO David Solomon (pictured) in 2018. The bank had halted its annual cuts during the pandemic
Even if Goldman Sachs cut its workforce by 4,000 employees, it would still have more employees than it has in 2021.
The company has been on something of a hiring frenzy since it was acquired by CEO David Solomon in 2018, when Goldman Sachs retained 36,300 employee positions, unchanged from the previous year.
In 2019, the workforce then increased to 38,300 and in the following year to 40,500. From 43,900 in 2021, the number rose by more than 5,000, one of the biggest spikes in the bank’s recent history.
However, Solomon previously warned that the bank needs to cut costs, with the threat of staff cuts among long-planned initiatives to save money.
“We continue to see headwinds in our expense positions, particularly in the near term,” Solomon said while speaking at a conference last week. “We have put certain cost reduction plans in place, but it will take time for the benefits to be realised.
‘Ultimately, we will remain agile and size the company to reflect the opportunities on offer.’
Goldman Sachs declined to comment on the layoffs.
Solomon has eyed measures to save money as the company’s shares have fallen more than 12 percent over the past year
The investment bank layoffs would come as PepsiCo, Walmart, Gap, Zillow, Ford, and Stanley Black & Decker all recently laid off their employees.
The industry-wide moves prompt fears that the US is heading for an “economic recession”.
In normal downturns, workers tend to lose their jobs first, but now office workers face mass layoffs.
According to a report by KPMG, more than half of US bosses are considering downsizing in the next six months.
Dave Gilbertson, vice president of software maker UKG, told the Financial Times: “I wouldn’t be at all surprised if employees were the first to be laid off in a recession scenario.
According to a report by Challenger, Gray & Christmas, which tracks such announcements, US-based tech companies have cut over 28,000 jobs so far this year, more than double the number a year earlier
“If you look at where the layoffs have been, it hasn’t really impacted labor markets yet. That’s because there’s such a huge labor shortage in these blue-collar roles.’
Last month, Meta that owns Facebook, Instagram and WhatsApp, announced that it will cut 13 percent of its workforce Elon Musk fired half of Twitter’s staff following its successful takeover of the social media site.
Experts have warned the industry faces a “triple whammy” of a slowing economy, inflation and an end to pandemic-driven growth.
Overall, U.S.-based tech companies have cut over 28,000 jobs so far this year, more than double last year, according to a report by Challenger, Gray & Christmas, which tracks such announcements.
In October, layoffs rose 13 percent – the highest increase since February 2021. US employers also eased hiring in November, with job creation falling at the sharpest rate since January 2021.
Just 127,000 jobs were added last month, much fewer than analysts were expecting and nearly half the 239,000 jobs added in October.
Companies that have seen tremendous growth during the pandemic, particularly in tech and e-commerce, are beginning to scale back spending before CFOs fear tough times will come.
According to statistics from the US Department of Labor, the unemployment rate is currently 3.7 percent.
https://www.dailymail.co.uk/news/article-11546553/Goldman-Sachs-lay-4-000-workers-8-workforce-January.html?ns_mchannel=rss&ns_campaign=1490&ito=1490 Goldman Sachs will lay off 4,000 employees — or 8% of its workforce — in January