Confirming reports of a massive layoff, Goldman Sachs is set to cut 3,200 jobs and could announce this as early as this week, reports suggest. The American investment bank hasn’t officially made an announcement on the matter yet.
A source told AFP that a maximum of 3,200 jobs will be eliminated, less than the figure of 4,000 cited in the press last month. The larger figure of 4,000 would be about eight per cent of the bank’s staff.
Laying off staff is a basic practice at Goldman Sachs which typically cuts one to five percent of headcount each year, targeting underperforming staff. However, the global economic setting and the increase in the company’s staff in recent years has meant that the company will fire more than the usual number of employees this year, a person familiar with the matter told AFP in mid-December.
In December, David Solomon, the chief executive of the US investment bank, had unveiled his plan to cut jobs in his traditional year-end message to staff. Solomon had said, “We are conducting a careful review and while discussions are still ongoing, we anticipate our headcount reduction will take place in the first half of January.”
Goldman’s staff stood at 49,100 at the end of October, up nearly 30 per cent from the end of 2019 after hiring campaigns and acquisitions.
Goldman Sachs and many other investment banks have seen a big drop in fees tied to initial public offerings, leading to massive layoffs across the industry. The outlook for merger and acquisition advising in 2023 also looks bad due to economic uncertainty.
However, despite rising interest rates, the company, as per a survey conducted by S&P Global Market, is expected to report big profits for 2022 and 2023. Analysts predict that it will make nearly $12 billion in net profits for 2022 and $13 billion in 2023, Guardian reported.
(With inputs from agencies)
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