Goldman Sachs is set to cut several hundred jobs as part of its annual performance review process, according to a source familiar with the matter. This move marks a return to performance-based job reductions, which were paused for two years during the COVID-19 pandemic.
The bank’s spokesperson stated to Reuters, “Our annual talent reviews are routine and customary. We anticipate a larger workforce at Goldman Sachs in 2024 compared to 2023.”
In the previous year, such reviews led to job losses for 1% to 5% of employees. Historically, the extent of cuts under Goldman’s strategic resource assessments has varied with market conditions and financial performance.
As of June 30, Goldman Sachs’ global workforce stood at 44,300. The bank implemented multiple rounds of workforce reductions in 2023 amid a downturn in dealmaking and the impact of prolonged high interest rates on the macroeconomic environment.
Despite these challenges, the bank’s financial performance improved, with a second-quarter profit more than doubling in July, driven by strong debt underwriting and fixed-income trading.
The recovery of the U.S. economy has bolstered corporate confidence, leading to increased dealmaking, debt sales, and stock offerings. Nevertheless, deal activity remains below historical norms.
Goldman Sachs’ shares rose in afternoon trading, closing 0.6% higher. The stock has surged 32% this year, outperforming both the broader market and an index of rival large-cap banks.
Earlier reports from the Wall Street Journal suggested that the layoffs, which have already started, could affect more than 1,300 employees, or 3% to 4% of the workforce, continuing through the fall. Goldman Sachs, however, disputed these figures, calling them inaccurate in its statement to Reuters.
