Goldman Sachs is set to reduce its workforce by a few hundred employees as part of its annual performance review, a source close to the matter revealed.
The move, which targets underperformers, marks a return to the bank’s pre-pandemic practices.
After pausing these cuts during the COVID-19 pandemic, Goldman reintroduced them in 2022.
A spokesperson for the bank described the process as “normal, standard, and customary,” downplaying the significance of the layoffs.
They added, “We expect to have more people working at Goldman Sachs in 2024 than 2023.”
Historically, these reviews have led to 1% to 5% of the bank’s staff being let go, with fluctuations based on market conditions and the bank’s financial outlook.
Currently, Goldman’s global workforce numbers around 44,300 as of the end of June.
The bank has already undertaken several rounds of layoffs this year, driven by a challenging dealmaking environment and the impact of sustained high interest rates on the broader economic landscape.
However, the second quarter brought some relief, with Goldman reporting a more than doubling of its profit, fueled by strong debt underwriting and fixed-income trading.
Despite these gains, the overall pace of dealmaking remains subdued compared to historical norms, even as the resilient U.S. economy boosts corporate confidence.
Goldman’s shares reflected a cautious optimism, climbing 0.6% by the close of trading, contributing to a 32% surge in 2023, outpacing both the broader market and an index of its large-cap banking peers.
Earlier reports suggested the layoffs could affect up to 1,300 employees, roughly 3% to 4% of the workforce.
However, Goldman has disputed these figures, calling them inaccurate.
As the bank navigates this period of adjustment, it remains focused on growth, hinting at a stronger headcount in the year ahead despite the current turbulence.
Goldman’s commitment to expanding its business operations underscores its belief in long-term success, even as it makes short-term adjustments.
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