The financial industry is bracing for a fresh round of job cuts as Wall Street banks slash costs to cushion the blow of further market turbulence and deepening economic woes in 2009.
Executives and analysts say the redundancies – to be finalised this month as banks prepare next year’s budgets – could top 70,000 among US groups alone and add to the estimated 150,000 jobs already lost by the financial sector worldwide.
Goldman Sachs, which has fared better than many rivals during the downturn, last week began a planned 10 per cent reduction in its 32,500-strong global workforce. That cut is part of the expected fourth-quarter cull.
Most other US banks have already announced cuts.
Citigroup is in the midst of scrapping 23,000 jobs, Merrill Lynch has lost an estimated 5,700 – nearly 9 per cent of staff – while Morgan Stanley has made 4,400 workers redundant, according to Bloomberg data.
These redundancies came on top of the estimated 23,000 jobs lost after the collapses of Bear Stearns and Lehman Brothers.
http://www.ft.com/cms/s/0/397aaa26-aea2-11dd-b621-000077b07658.html?nclick_check=1But bankers say more is to come as the industry’s revenues continue to fall in the fourth quarter and show little sign of improving in 2009.
A senior executive predicted that, based on his company’s own estimates, the next round of redundancies among US-based firms could reach 70,000.
A recent study by the Federal Reserve concluded that New York city alone could lose between 55,000 and 78,000 financial jobs over the next few years.
