Goldman Sachs intends to commence staff reductions next month, signalling a departure from its traditional approach to layoffs. This strategy shift, discussed by multiple sources familiar with the matter, aims to implement a series of smaller cuts rather than a single, extensive layoff event.
Historically, the Wall Street bank has conducted significant layoffs during the spring and autumn months, often eliminating thousands of positions by targeting what it perceives as the lowest-performing 5% of its global workforce. However, this year, Goldman will forego its typical spring “Strategic Resource Assessment” (SRA), a term referring to a large-scale employee review, opting instead for incremental cuts. The first wave of layoffs is anticipated in April, with further reductions continuing through the summer. This change is intended to provide divisional leaders with greater flexibility in managing timing, as opposed to relying on an annual firmwide assessment, although another round of SRA may still occur later in the year.
The impending job cuts will affect all sectors within the bank, ranging from its prominent investment banking division to its growing asset and wealth management arm. Nevertheless, the reductions are expected to be significantly smaller than those implemented last March, which targeted up to 2,300 positions. Final decisions regarding specific roles and numbers have not yet been confirmed, as those knowledgeable about the situation remain anonymous due to its sensitive nature.
A Goldman Sachs spokesperson stated that regular assessment of employee numbers is standard practice for publicly traded companies, emphasising ongoing evaluations of performance across divisions. The firm does not discuss specific workforce reduction targets.
The forthcoming layoffs are reportedly not linked to the bank’s recent “One Goldman Sachs” initiative, introduced in October to enhance operational efficiency through artificial intelligence, which mentioned a “limited reduction in roles.” In its latest earnings report, Goldman Sachs revealed annual revenues exceeding £58 billion, reflecting a 9% increase from the previous year. Other major corporations, including Citi and Amazon, have also reported job reductions this year.
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