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staff cuts, 3,200 employees laid off

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staff cuts, 3,200 employees laid off

Goldman Sachs starts the new year uphill, starting from Wednesday the financial giant is preparing to lay off more than 3.000 employees to counter the difficult macroeconomic context.

According to Bloomberg’s anonymous sources it is 3,200 workers but the definitive number has yet to be determined. The sources could not be named as the information has not yet been released to the public.

At the end of the third quarter of 2022, Goldman had 49,100 employees globally after adding a significant number of hires during the coronavirus pandemic.

Goldman Sachs stock travels upwards 0,2% a $349 per share in Wall Street pre-market, following a positive start to 2023.

Investment banking and trading division hardest hit, bonuses down 40%

Also according to Bloomberg reports, the layoffs concern most of the main divisions but should mainly focus on the division investment banking e trading by Goldman Sachs. Institutional banks have experienced a slowdown in M&A activity due to the volatility of global financial markets.

Hundreds of jobs also to be cut in loss-making consumer finance division after bank scales plans for direct-to-consumer unit Marcus.

The managing director, David Solomonsent a year-end voice memo to staff warning of a reduction in headcount in the first half of January, according to unnamed sources with knowledge of the facts.

Job reductions anticipate payments of bonus annual payments from Goldman, which are usually paid by the end of January and, moreover, this year are expected to drop by about 40%.

Goldman Sachs restarted its annual job cuts program in September that had been suspended for two years during the pandemic. Each year, the Wall Street giant typically cuts 1% to 5% of its staff.

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Fees from investment banking halved in 2022

Fees from investment banking nearly halved in 2022, with 77 billion dollars earned globally by banks, down compared to $132.3 billion of the previous year, according to Dealogic data.

The total value of mergers and acquisitions (M&As) globally as of December 20 plummeted by 37% to 3.66 trillion dollarsagain according to Dealogic data, after reaching an all-time high of $5.9 trillion in 2021.

According to Dealogic’s numbers, the banks had executed ECM (Equity Capital Markets) transactions worth 517 billion dollars by the end of December 2022, the lowest level since the early 2000s and declining 66% compared to the business‘s perceived profits in 2021.

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