Authored by Manya Saini
According to a source familiar with the matter, Goldman Sachs is set to eliminate several hundred jobs as part of its annual review process targeting underperformers, Reuters reported on Friday.
The investment bank resumed performance-based job cuts in 2022 after pausing them for two years due to the COVID-19 pandemic.
“Our annual talent reviews are routine and customary,” a Goldman spokesperson told Reuters. “We anticipate having more employees at Goldman Sachs in 2024 than in 2023.”
Last year, the review led to a 1% to 5% reduction in Goldman’s workforce. The extent of job cuts under Goldman’s strategic resource assessment has varied over time based on market conditions and financial prospects.
As of the quarter ended June 30, the bank had a global workforce of 44,300. In 2023, it underwent multiple rounds of job cuts due to a decline in dealmaking and the impact of higher interest rates on the economic outlook.
The banking sector has seen improvements with Goldman reporting a significant increase in second-quarter profits in July, driven by strong debt underwriting and fixed-income trading. The strength of the U.S. economy has encouraged corporate leaders to pursue deals, debt offerings, and stock sales. However, deal activity remains below historical averages despite the sector-wide recovery.
Goldman’s stock performance has been positive, with a 32% increase this year, outperforming both the broader market and a benchmark tracking other large-cap banks.
Earlier in the day, a report by the Wall Street Journal suggested that ongoing layoffs at Goldman could affect more than 1,300 employees, representing 3% to 4% of its workforce. However, Goldman refuted these figures in a statement to Reuters.