Goldman Sachs plans to cut up to 4,000 “underperforming” employees to cut costs during a profitability crisis, according to a report Friday.
Top Brass has reportedly asked managers to identify struggling employees for possible cuts. Semaphore reported, citing sources familiar with the matter. The layoffs are scheduled to begin early next year and could affect up to 8% of Goldman’s workforce, which currently consists of more than 49,000 employees.
The bank has yet to make final decisions on the extent of the expected job cuts, a person familiar with the bank’s considerations told The Post. Even after the layoffs, the bank’s headcount will be higher than before the COVID-19 pandemic.
As reported by the Post he Dec. 6, Goldman’s annual performance review process, has unsettled employees this year as workers brace for potential cuts.
“People are very nervous … everyone is just waiting in anticipation,” a Goldman insider told The Post at the time.
Goldman Sachs declined to comment.
The layoffs are part of a range of cost-cutting measures reportedly being considered at the bank. The Financial Times reported that Goldman could cut premiums on its investment Bankers up 40% this year – the steepest cut since the Great Recession.
earlier this week, Bloomberg reports that Goldman was planning at least 400 cuts in its ailing retail banking business.
Goldman Sachs CEO David Solomon recently referenced the difficult global economic conditions in 2023 and signaled that the bank would look to cut its costs — with headcount reductions among planned initiatives.
“We continue to see headwinds on our spending, particularly in the near term,” Solomon said while speaking at a conference last week, according to Bloomberg. “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 business to reflect the opportunities that arise.”
In October, Solomon told CNBC it was “a time of caution” and warned of a “good opportunity” for the US economy would slide into a recession.
Goldman had been on a hiring spree in recent years during a Solomon-led foray into consumer banking. A trio of acquisitions, including last year’s purchase of specialty lender GreenSky, have also increased the bank’s workforce.
Goldman is the latest of several companies planning layoffs as Wall Street braces for a deteriorating economic outlook. Citigroup recently announced dozens of job cuts across its business, while Barclays laid off about 200 employees and Morgan Stanley cut about 1,600 jobs.
The bank’s profitability has plummeted this year, dragged in part by Marcus, its money-losing digital consumer bank. In October, Goldman announced a major internal reorganization that would combine its investment banking and trading operations into a single entity and integrate Marcus into its wealth and wealth management division.