Title: Job Cuts at America’s Largest Banks Signal Hiring Slowdown Amidst Pandemic Rebound
Introduction:
Job cuts in the American banking sector are expected to surpass 11,000 this year, representing the worst hiring market since the 2008 financial crisis. This trend follows a wave of hiring triggered by the rebounding economy post-Covid-19. Citigroup’s recent announcement of 5,000 layoffs by the second quarter and the cost-cutting measures undertaken by Goldman Sachs and Morgan Stanley underscore the challenging employment landscape on Wall Street. These cuts come in response to efforts by the sector’s leaders to halt the expansion of their workforces, which ballooned due to increased transactions and remote working practices during the pandemic.
The Hiring Spree and Current Job Reductions:
During the first quarter, the five major Wall Street banks (JPMorgan Chase, Bank of America, Morgan Stanley, Citi, and Goldman Sachs) collectively employed a record 882,000 individuals worldwide. Despite experiencing an increase of over 100,000 employees since March 2020, this figure remained virtually unchanged from the end of 2022. Goldman Sachs witnessed the most significant workforce reduction in years, with a decline of 6.4% to 45,400. Morgan Stanley’s workforce also experienced a slight decrease to 82,266, while Citi’s remained unchanged. JPMorgan did not announce any major cuts during this period.
Other Key News Highlights:
African Peace Mission: South African President Cyril Ramaphosa will lead a delegation to Ukraine and Russia, aiming to end an ongoing conflict.
Economic Data: The European Union will release its harmonized consumer price index for the previous month.
Company Reports: Investment bank Peel Hunt will provide financial reports. Additionally, Tesco’s chairman, John Allan, will step down, and online estate agent Purplebricks will withdraw from London’s AIM market.
Upcoming Celebrations: The UK will observe King Charles III’s official birthday with the Trooping the Color ceremony, and several countries will celebrate Father’s Day on Sunday.
Landmark Deals on Using News to Train Artificial Intelligence:
Tech and media giants, including OpenAI, Google, Microsoft, and Adobe, are engaging in discussions with publishers to explore copyright issues associated with using news as training data for artificial intelligence products like text chatbots and image generators.
BlackRock’s Potential Bitcoin Cash Fund:
BlackRock, a $9 trillion fund manager, may operate the first publicly traded bitcoin cash fund in the US pending approval from the Securities and Exchange Commission (SEC). This move could provide a boost for the struggling cryptocurrency sector.
Increased Demand for Natural Gas Infrastructure:
The CEO of Williams Companies, a pipeline giant, predicts that soaring wind and solar energy demand in the US will necessitate an expansion of natural gas infrastructure to serve as backup during power outages and to support increased electricity consumption in transportation and heavy industry.
UK Government’s Asylum Backlog Woes:
The National Audit Office warns that the UK government is unlikely to clear its asylum backlog within the year due to record delays in processing claims, leading to a doubling of support costs.
US Banking Regulator’s Sale of German Operations:
The US banking regulator has initiated the sale of the German operations of Silicon Valley Bank, seeking offers for loans, leases, and other assets from the collapsed lender.
Expanding on the Topic: The Future of Hiring in the Banking Sector
Amidst the job cuts plaguing America’s largest banks, it is crucial to reflect on the future of hiring in the banking sector. The pandemic-induced hiring spree witnessed a dramatic increase in the workforce as banks rushed to adapt to the surge in transactions and remote work. However, with the easing of pandemic-related restrictions and a return to more traditional business practices, the need for such a large workforce has diminished.
1. Evolving Work Practices: The pandemic forced banks to embrace remote work, leading to a reassessment of the traditional ways of doing business. As the sector transitions to a hybrid work model, the requirement for physical office space and the associated costs may decrease. This shift could impact future hiring decisions, particularly in areas closely tied to remote functionality, such as technology and digital banking.
2. Automation and Artificial Intelligence: Banks have increasingly leveraged automation and AI technologies to streamline processes and enhance efficiency. As these technologies continue to advance, they may replace certain roles and reduce the demand for human labor. This evolution may reshape the future hiring landscape, necessitating a shift in skill requirements towards individuals with expertise in data analytics, machine learning, and AI.
3. Strategic Workforce Planning: The recent surge in hiring and subsequent job cuts highlight the importance of strategic workforce planning in the banking sector. To avoid overstaffing during bullish periods and unnecessary layoffs during downturns, banks must adopt a proactive approach that considers long-term market trends, technology advancements, and changing customer preferences. This entails aligning workforce composition with business strategies and continuously evaluating staffing needs.
4. Upskilling and Reskilling Initiatives: Given the evolving nature of the industry, banks must invest in upskilling and reskilling initiatives to equip their employees with the necessary knowledge and skills. Upskilling programs can help existing employees adapt to changing roles and embrace emerging technologies, ensuring a more agile and flexible workforce. This approach also fosters employee retention and job satisfaction, as employees feel valued and continually empowered to succeed.
Conclusion:
The current wave of job cuts at America’s largest banks reflects a slowdown in hiring and a strategic adjustment of their workforces following a pandemic-era boom in transactions and remote work. This trend highlights the need for industry leaders to strike a balance between adaptability and prudent workforce planning. As the sector embraces hybrid work models, automation, and AI technologies, banks must strategize for the future, investing in upskilling initiatives and aligning their hiring practices with the evolving needs of a rapidly changing industry. By doing so, banks can better position themselves to thrive in the post-pandemic economy.
—————————————————-
| Article | Link |
|---|---|
| UK Artful Impressions | Premiere Etsy Store |
| Sponsored Content | View |
| 90’s Rock Band Review | View |
| Ted Lasso’s MacBook Guide | View |
| Nature’s Secret to More Energy | View |
| Ancient Recipe for Weight Loss | View |
| MacBook Air i3 vs i5 | View |
| You Need a VPN in 2023 – Liberty Shield | View |
Job cuts at America’s largest banks are on track to top 11,000 this year as Wall Street faces the worst hiring market since the financial crisis following a pandemic-era hiring spree.
Citigroup this week became the latest major U.S. bank to announce major job cuts, telling investors it plans to make 5,000 layoffs by the end of the second quarter, mostly in investment banking and trade. This followed budget cuts affecting thousands of bankers at Goldman Sachs and Morgan Stanley.
The job cuts come as leaders attempt to halt a hiring spree that began as the economy rebounded from Covid-19. Banks have dramatically increased their workforces to cope with a boom in transactions and exchanges at a time when working from home has disrupted traditional ways of doing business.
At the end of the first quarter, the big five banks that dominate Wall Street – JPMorgan Chase, Bank of America, Morgan Stanley and Citi – collectively employed a record 882,000 worldwide, virtually unchanged from the end of 2022 and an increase of more than 100,000 compared to the end of March 2020.
The only bank to report a significant reduction in its workforce in the first three months of the year was Goldman, where the workforce fell 6.4% to 45,400, the biggest drop in years. Morgan Stanley’s fell slightly to 82,266, while Citi’s was flat. JPMorgan did not announce any large-scale cuts.
Here’s what else I’m watching today and this weekend:
-
African Peace Mission: South African President Cyril Ramaphosa will lead the leaders of Egypt, Republic of Congo, Senegal, Uganda and Zambia on a visit to Ukraine and Russia in a ambitious attempt to end the war.
-
Economic data : The EU has its harmonized consumer price index for the last month.
-
Companies: Reports from investment bank Peel Hunt. Tesco chairman John Allan will step down at the retailer’s annual meeting today, while online estate agent Purplebricks will pull out of London’s AIM market.
-
Celebrations: The UK will mark King Charles III’s official birthday tomorrow with the Trooping the Color ceremony, while several countries celebrate Father’s Day on Sunday.
Five other top stories
1. Exclusive: Tech and media giants are in talks to make landmark deals on using news to train artificial intelligence. OpenAI, Google, Microsoft and Adobe have met with information officers in recent months to discuss copyright issues related to AI products such as text chatbots and image generators. Here are the publishers concerned.
2. BlackRock may run the first publicly traded bitcoin cash fund in the US if its application to the United States Securities and Exchange Commission is approved. The $9 trillion fund manager already runs a private cash bitcoin trust that he launched last year. Here’s how the move could be a boost for the struggling crypto sector.
3. Exclusive: Soaring U.S. Wind and Solar Demand Will Create Greater Need for Natural Gas Infrastructure to act as a back-up against power outages, said the boss of the pipeline giant Williams Companies, arguing that policies to increase the use of electricity in cars and heavy industry will also increase the load on the grid.
4. The UK government is ‘not on track’ to clear its asylum backlog this year, has warned the National Audit Office as record delays in processing claims have led to support costs nearly doubling to £3.6billion in 2022-23. Learn more about the pileup of 75,000 cases.
5. The US banking regulator has launched the sale of the German operations of Silicon Valley Bank, seek offers by July 19 for loans, leases and other assets from the collapsed lender. Here are more details about the $460 million wallet on sale.
Did you follow the news this week? Take our quiz.
In-depth news
© Adem Altan/AFP/Getty Images
Turkey’s new financial leadership faces a daunting challenge as it seeks to pull the $900 billion economy from the brink. Finance Minister Mehmet Şimşek and central bank governor Hafize Gaye Erkan will have to sharply raise borrowing costs and further depreciate the pound as the country’s foreign currency war chest is ‘dangerously’ depleted by the president’s unorthodox policies Recep Tayyip Erdoğan.
We also read. . .
Card of the day
cruise ships pumped four times more harmful sulfuric gases into the atmosphere in Europe than passenger vehicles last year, according to climate lobby group Transport & Environment. Barcelona is Europe’s worst-hit port city for sulfur oxide emissions, which have been proven to cause acid rain and can worsen respiratory problems.
Take a break from the news
Downhill skateboarding is an incredibly dangerous sport. But skaters like Jenny Schauerte are part of a growing group of free spirits who travel the world in search of the perfect descent. Simon Usborne’s jaw-dropping piece takes you into their wild world.
Additional contributions from Benjamin Wilhelm and Gordon Smith
https://www.ft.com/content/896149a2-e64d-4d00-a5da-e93fa29b82a0
—————————————————-