Goldman Sachs has begun laying off workers across the US — and the Wall Street giant is focused on culling mid-level investment bankers amid a downturn in dealmaking as the economy slows, according to a report.
Last week, Goldman laid off nearly a dozen bankers in the prestigious technology, media and telecommunications division alone, according to an Insider report. Consumer retail, health care and industrials divisions have also been hit by layoffs, the report adds.
While bankers at every level have been affected, senior associates and vice presidents have borne the brunt of the culling since they’re advanced enough to cost the company money but typically aren’t rainmakers like partners at the firm, the report notes.
Before the pandemic, Goldman annually culled 1% to 5% of under-performers from its workforce every year but halted the firings as business boomed during the pandemic.
This year’s layoffs are on the lower end of that range, a source with knowledge told The Post, but it’s still a stark change from just a year ago, when the bank was hiking salaries and bonuses in a bid to meet a dire talent shortage across the industry.
It’s not just the US bankers getting pink slips. Around a dozen bankers in the London office of Goldman Sachs have been axed, according to a Financial News report, and more than two dozen bankers in China have been fired, according to Reuters.
“Every year globally we conduct a strategic assessment of our resources and calibrate headcount to the current operating environment,” a Goldman spokesperson told The Post. “We continue to remain flexible while executing against our strategic growth priorities.”
This year’s resumption of layoffs come amid a dramatic slump in revenue. The Wall Street giant helmed by David Solomon reported second-quarter earnings of $2.93 billion, precipitously lower than the second quarter of 2021, when the bank hauled in $5.49 billion.
Investment banking was the driving force behind the slump — bringing in 41% less than it did a year ago. Trading revenue of $6.47 billion — up 32% year over year — slightly offset losses.
In July, The Post reported that talk of hiring freezes and firings was circulating at financial firms as soaring interest rates and recession fears tanked appetites for mergers, IPOs and other big corporate deals, according to sources.