According to a report published on Friday, Goldman Sachs is intending to lay off as many as 4,000 “poor performers” in an effort to reduce expenses during a profitability crunch.
According to Semafor, citing persons acquainted with the subject, the company’s leadership has reportedly ordered managers to identify problematic staff for possible layoffs. The layoffs are scheduled to begin early in 2019 and could affect up to 8% of Goldman’s present workforce of over 49,000 people.
A source familiar with the bank’s thinking told The Post that no final decisions have been made regarding the scale of the anticipated layoffs. After the layoffs, the bank will still have more employees than it did before the COVID-19 outbreak.
As reported by The Post on December 6, Goldman’s annual performance assessment process is unsettling staff this year due to the possibility of layoffs.
“People are quite tense… All are merely anticipating,” a Goldman Sachs insider told The Post at the time.
The company declined to comment.
The bank is apparently considering an array of cost-cutting measures, including layoffs. The Financial Times reported that Goldman may reduce the bonuses of its investment bankers by 40 percent this year, which would be the largest reduction since the Great Recession.
Bloomberg reported earlier this week that Goldman was planning at least 400 layoffs in its troubled retail banking segment.
The CEO of Goldman Sachs, David Solomon, recently acknowledged challenging global economic conditions in 2023 and warned the business will seek to reduce costs, including a reduction in headcount.
Last week, according to Bloomberg, Solomon remarked at a conference, “We continue to expect challenges on our spending lines, particularly in the short term.” “We’ve implemented a number of expense reduction strategies, but it will take time to see the advantages. Ultimately, we will maintain our agility and scale the business to match the opportunity set.”
In October, Solomon told CNBC that it was “time to be cautious” and that there was a “good probability” the United States economy would enter a recession.
During Solomon’s push into consumer banking, Goldman has gone on a recruiting spree during the past few years. The bank’s workforce count has also increased as a result of three acquisitions, including the purchase of specialized lender GreenSky last year.
As Wall Street braces for a deteriorating economic outlook, Goldman is the most recent corporation to plan layoffs. Citigroup recently announced dozens of layoffs across its business, while Barclays and Morgan Stanley each eliminated approximately 200 and 1,600 positions, respectively.
This year, the bank’s profitability plummeted due in part to Marcus, its money-losing digital consumer bank. In October, Goldman announced a significant internal reorganization in which its investment banking and trading activities were merged into a single unit and Marcus was integrated into its asset and wealth management division.
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