According to a source familiar with the situation, Goldman Sachs Group Inc. (GS.N) is preparing to lay off thousands of workers as it navigates a challenging economic environment.
The latest indication that cuts are accelerating on Wall Street as dealmaking slows is the layoffs. A slowdown in mergers and share offerings has resulted in a decline in investment banking revenues this year, indicating a sharp contrast to the spectacular 2021 period when bankers saw significant pay increases.
At the end of the third quarter, Goldman Sachs had 49,100 workers, up significantly from the beginning of the pandemic. According to the insider, the company’s headcount will stay above pre-pandemic levels. According to a filing, the workforce totaled 38,300 at the end of 2019.
According to a different source familiar with the situation, the bank is considering taking a significant cut to the yearly bonus pool this year. According to Reuters’ January forecast, top-performing investment bankers will see raises of 40% to 50% in 2021. The claim was based on interviews with persons who had firsthand knowledge of the situation.
He wrote in a note, “Goldman Sachs now needs to demonstrate that it can do the same when business is not as good and that they live up to the old Wall Street maxim that they ‘eat what they kill’.”
After delaying the usual procedure for two years due to the epidemic, Goldman terminated approximately 500 employees in September, according to a source familiar with the situation who spoke to Reuters at the time.
The investment bank initially forewarned that it would limit recruiting and cut spending in July.
As a dealmaking boom on Wall Street sputtered out due to high interest rates, tensions between the United States and China, the war between Russia and Ukraine, and surging inflation, global banks, notably Morgan Stanley (MS.N) and Citigroup Inc (C.N), have decreased their workforces recently.
