New wave of layoffs – Goldman Sachs lays off hundreds of executives

It seems that, like many others, the largest investment banks have not managed to escape the crisis, which, under pressure, are laying off more and more people. Namely, Goldman Sachs has begun laying off executive directors worldwide, and due to a decline in business, the company plans to seriously cut the number of employees.

More specifically, as reported by Bloomberg, approximately 125 directors could lose their jobs, although not all layoffs have been carried out yet.

These layoffs are just part of the bank’s austerity measures, which has gone through at least three rounds of layoffs in less than a year. Goldman Sachs and other banks increased their workforce in 2020 and 2021 amid a sharp rise in mergers and acquisitions and initial public offerings, and are now struggling with declining fees due to reduced business volume.

They are not alone

JPMorgan Chase is also laying off bankers due to a slowdown in business, while Citigroup has laid off hundreds of employees this year and reportedly plans to lay off five thousand employees by the end of the second quarter – mainly in investment banking and trading, Bloomberg News reported this month.

Earlier this month, foreign media reported that more than 11 thousand banking jobs are likely to be eliminated this year. The reason? Investment banks’ revenues in the first quarter fell by 22 percent year-on-year — resulting in the weakest first-quarter results since 2016, according to Refinitiv data.

Banks are left with too many employees and too few jobs after a sharp decline in capital market activity last year, following record levels reached the year before. At the end of the first quarter, the five banks that dominate Wall Street – JP Morgan, Bank of America, Morgan Stanley, Goldman Sachs, and Citi – together employed a record 882 thousand people globally. This is an increase of over 100 thousand employees compared to the end of March 2020. However, it seems that in 2023 they will have to adapt to a more challenging and uncertain environment.