Goldman Sachs Prepares Biggest Layoffs Since 2008 Financial Crisis

By Saeed Azhar and Scott Murdoch

(Reuters)—Goldman Sachs Group will start cutting thousands of jobs across the firm from Wednesday, two sources familiar with the move said, as it prepares for a tough economic environment.

Just over 3,000 employees will be let go, one of the sources said, but the final number is yet to be determined. That scale of layoffs would be the largest since the 2008 financial crisis, one of the sources said.

The sources could not be named as the information was not yet disclosed publicly. Goldman Sachs declined to comment.

Bloomberg News reported on Sunday that Goldman would eliminate about 3,200 positions.

Goldman had 49,100 employees at the end of the third quarter, after adding significant numbers of staff during the coronavirus pandemic.

The layoffs are likely to affect most of the bank’s major divisions, but should centre on Goldman Sachs’ investment banking arm, one of the sources said. Wall Street banks have suffered a major slowdown in corporate dealmaking activity as a result of volatile global financial markets.

Hundreds of jobs are also likely to be reduced from Goldman Sachs’ consumer business, Marcus, after it scaled back plans for the loss-making unit, the sources said.

The bank’s chief executive David Solomon sent a year-end voice memo to staff warning of a headcount reduction in the first half of January, two separate sources said. Goldman Sachs declined comment on the memo.

The job cuts come ahead of the bank’s annual bonus payments which are usually delivered later in January and are expected to fall about 40%.

The bank restarted its annual performance review process and staff cuts in September after pausing for two years during the pandemic.

The Wall Street giant typically trims about 1% to 5% of employees each year. These new cuts will come on top of the earlier layoffs.

Global banks, including Morgan Stanley and Citigroup Inc, have reduced their workforces in recent months as a dealmaking boom on Wall Street fizzled out due to high interest rates, tensions between the United States and China, the war between Russia and Ukraine, and soaring inflation.

Global investment banking fees nearly halved in 2022, with $77 billion earned by the banks, down from $132.3 billion one year earlier, Dealogic data showed.

The total value of mergers and acquisitions (M&A) globally had slumped 37% to $3.66 trillion by Dec. 20, according to Dealogic data, after hitting

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