In this image, people are seen standing on the floor of Goldman Sachs' global headquarters, located at 200 West Street in New York City. The photo was taken on January 11, 2023, by Reuters photographer Shannon Stapleton.
Goldman Sachs is set to reduce its workforce by a few hundred employees as part of its annual review process aimed at trimming underperforming staff, according to a source familiar with the situation. This yearly exercise, which the investment bank reinstated in 2022 after a two-year pause during the COVID-19 pandemic, is designed to identify and remove lower-performing employees.
A spokesperson for Goldman Sachs commented that this review is a routine procedure, calling it "normal, standard, and customary," and added that the bank expects to have more employees in 2024 compared to 2023.
Last year’s review resulted in 1% to 5% of employees losing their jobs, and this percentage has varied depending on the bank's financial outlook and market conditions. Goldman Sachs, which had a global workforce of 44,300 as of June 30, 2023, implemented multiple rounds of job cuts throughout 2023 as dealmaking slowed and higher interest rates affected the economic climate.
Despite the challenging environment earlier in the year, Goldman Sachs reported strong results for the second quarter, with profit more than doubling due to robust performance in debt underwriting and fixed-income trading. The resilience of the U.S. economy has provided businesses with the confidence to pursue mergers, debt sales, and stock offerings. However, even with the economic recovery, dealmaking activity remains below historical levels.
Goldman Sachs' stock responded positively to the news, closing 0.6% higher. The stock has surged by 32% this year, outperforming both broader markets and a key index of large-cap banks.
Earlier, a report from the Wall Street Journal indicated that the layoffs, which have already started, will continue through the fall and could affect over 1,300 employees, representing about 3% to 4% of the bank's workforce. However, Goldman Sachs disputed these figures in their statement to Reuters, asserting that the numbers reported were inaccurate.
