Since the beginning of this year, due to the unclear economic outlook and the global economic downturn, major American banking giants have started massive layoffs to reduce costs, with Citigroup planning the largest scale of job cuts. They plan to lay off 20,000 people over the next two years and have already laid off 2,000 people recently.
Bank of America, Wells Fargo, and PNC Financial have also followed suit, cutting a total of about 2,000 people.
This wave of layoffs is caused by multiple factors, with the primary factor being the unclear economic outlook. It is still unknown when the global economic downturn will ease, and the Federal Reserve's failure to control inflation, without officially announcing a plan for interest rate cuts, has put tremendous pressure on the banks, forcing them to control costs.
Citigroup's CFO, Mark Mason, announced the bank's layoff plan last Friday, stating that these layoffs are part of a larger plan which will total 7,000 job cuts. This plan will be announced in the upcoming quarterly earnings report.
Bank of America's CEO, Brian Moynihan, publicly stated on Tuesday: “We have managed our number of employees,” acknowledging the ongoing layoffs. Since the first quarter of 2023, over 4,700 people have been cut, with the reduction including both employees and positions, so no new hires will be coming in to fill those roles.
Goldman Sachs and Morgan Stanley, however, appear more optimistic. Although both companies are also conducting layoffs, with 900 and 396 people being cut respectively, both banks are optimistic about the economic outlook. Morgan Stanley's CFO, Sharon Yeshaya, announced on Tuesday that they are looking for opportunities to recruit.
Even more optimistic is JPMorgan Chase, the largest bank in the United States, which has not only avoided large-scale layoffs but has even significantly expanded its workforce, hiring 2,000 new employees just in the first quarter, bringing the total to 312,921 employees.
