Goldman Sachs Trims Its Ranks Again amid Market Slowdown
- Goldman Sachs cut employment before, in September and in January.
- Other Wall Street Banks also announced cuts this month.
Goldman Sachs (NYSE: GS) plans to reduce its employee numbers again, making it the third time within the last nine months. The publicly-listed lender on Wall Street claims that a significant decline in dealmaking activity has compelled it to make such a move.
Goldman Sachs Cuts Employment Again
On Tuesday, TheWall Street Journal reported that the financial giant is ready to lay off 250 people, including managing directors. According to anonymous sources familiar with the matter, the exact timeline for the lay-offs is unknown, but they may begin within the next few weeks.
Goldman Sachs was one of the first banks to initiate a series of drastic reductions to its staff on Wall Street last year. At that time, several hundred people lost their jobs. Then, in January 2023, the institution eliminated another 3,200 positions.
Morgan Stanley took a similar step, laying off about 3,000 just this month, and JPMorgan Chase, getting rid of 500 people. They all share the same motivation for the cuts: a drought in the dealmaking activity. Moreover, during the pandemic, financial institutions drastically increased their workforce without foresight. Now, they are feeling the effects of this of those actions.
Some employees chose to leave Goldman Sachs last month, prior to the redundancies. Fredrik Grunberger, a Managing Director in Hong Kong, along with Tomiyuki Oji and David Williams, the Managing Directors in Tokyo, recently changed employers, according to sources quoted by Bloomberg.
Goldman Sachs is considering another round of job cuts, the third in under a year
— Bloomberg TV (@BloombergTV) May 31, 2023
Stefania Bianchi explains why the move reflects a wider tendency across Wall Street https://t.co/QDOKHRDXIEpic.twitter.com/kaIdTGJSmK
Rough Start for Goldman Sachs
While Goldman Sachs' stock prices on Wall Street are just 15% off their historic highs, the financial results for Q1 2023 paint a significantly worse picture. In mid-April, Goldman Sachs reported a drop of 19% in profits due to the previously mentioned dealmaking and bond trading. For the second quarter in a row, the results were worse than those reported by rival banks.
The bank announced in January that it intended to slim down its operations to improve results. According to Reuters, the Wall Street giant was preparing to reduce alternative investments by $59 billion. A board member told the agency that this move aims to reduce the burden on financial results and revenue.
A small consolation for Goldman Sachs may be the fact that there are banks that are doing even worse. For example, Credit Suisse found itself on the verge of bankruptcy Bankruptcy Bankruptcy or insolvency constitutes a legal term and refers to being unable to repay debts. A business and a person can declare bankruptcy. When a person or company claims bankruptcy, it is described as a voluntary bankruptcy, and when your debtors force you into bankruptcy, it is referred to as involuntary. A voluntary bankruptcy occurs when the debtor or borrower, the party that owes the money files with the courts. Involuntary bankruptcy happens when your credits file a petition with the co Bankruptcy or insolvency constitutes a legal term and refers to being unable to repay debts. A business and a person can declare bankruptcy. When a person or company claims bankruptcy, it is described as a voluntary bankruptcy, and when your debtors force you into bankruptcy, it is referred to as involuntary. A voluntary bankruptcy occurs when the debtor or borrower, the party that owes the money files with the courts. Involuntary bankruptcy happens when your credits file a petition with the co Read this Term and was saved by UBS. However, after merging with its Swiss competitor, UBS planned a massive staff reduction of about 36,000 people.
Goldman Sachs (NYSE: GS) plans to reduce its employee numbers again, making it the third time within the last nine months. The publicly-listed lender on Wall Street claims that a significant decline in dealmaking activity has compelled it to make such a move.
Goldman Sachs Cuts Employment Again
On Tuesday, TheWall Street Journal reported that the financial giant is ready to lay off 250 people, including managing directors. According to anonymous sources familiar with the matter, the exact timeline for the lay-offs is unknown, but they may begin within the next few weeks.
Goldman Sachs was one of the first banks to initiate a series of drastic reductions to its staff on Wall Street last year. At that time, several hundred people lost their jobs. Then, in January 2023, the institution eliminated another 3,200 positions.
Morgan Stanley took a similar step, laying off about 3,000 just this month, and JPMorgan Chase, getting rid of 500 people. They all share the same motivation for the cuts: a drought in the dealmaking activity. Moreover, during the pandemic, financial institutions drastically increased their workforce without foresight. Now, they are feeling the effects of this of those actions.
Some employees chose to leave Goldman Sachs last month, prior to the redundancies. Fredrik Grunberger, a Managing Director in Hong Kong, along with Tomiyuki Oji and David Williams, the Managing Directors in Tokyo, recently changed employers, according to sources quoted by Bloomberg.
Goldman Sachs is considering another round of job cuts, the third in under a year
— Bloomberg TV (@BloombergTV) May 31, 2023
Stefania Bianchi explains why the move reflects a wider tendency across Wall Street https://t.co/QDOKHRDXIEpic.twitter.com/kaIdTGJSmK
Rough Start for Goldman Sachs
While Goldman Sachs' stock prices on Wall Street are just 15% off their historic highs, the financial results for Q1 2023 paint a significantly worse picture. In mid-April, Goldman Sachs reported a drop of 19% in profits due to the previously mentioned dealmaking and bond trading. For the second quarter in a row, the results were worse than those reported by rival banks.
The bank announced in January that it intended to slim down its operations to improve results. According to Reuters, the Wall Street giant was preparing to reduce alternative investments by $59 billion. A board member told the agency that this move aims to reduce the burden on financial results and revenue.
A small consolation for Goldman Sachs may be the fact that there are banks that are doing even worse. For example, Credit Suisse found itself on the verge of bankruptcy Bankruptcy Bankruptcy or insolvency constitutes a legal term and refers to being unable to repay debts. A business and a person can declare bankruptcy. When a person or company claims bankruptcy, it is described as a voluntary bankruptcy, and when your debtors force you into bankruptcy, it is referred to as involuntary. A voluntary bankruptcy occurs when the debtor or borrower, the party that owes the money files with the courts. Involuntary bankruptcy happens when your credits file a petition with the co Bankruptcy or insolvency constitutes a legal term and refers to being unable to repay debts. A business and a person can declare bankruptcy. When a person or company claims bankruptcy, it is described as a voluntary bankruptcy, and when your debtors force you into bankruptcy, it is referred to as involuntary. A voluntary bankruptcy occurs when the debtor or borrower, the party that owes the money files with the courts. Involuntary bankruptcy happens when your credits file a petition with the co Read this Term and was saved by UBS. However, after merging with its Swiss competitor, UBS planned a massive staff reduction of about 36,000 people.