Goldman’s cuts to its investment banking and consumer banking divisions will mean up to 3200 people losing their jobs—the equivalent of 6.5% of the bank’s total workforce of around 49,000.
BlackRock’s headcount reduction is expected to amount to 2.5% of its almost 20,000 employees, with 500 set to lose their jobs.
The cuts were announced in internal memos from the companies’ chief executives, Larry Fink—the UCLA Anderson MBA grad now CEO of Blackrock—and David Solomon at Goldman.
The announcements reflect the difficult economic period following the Covid pandemic, when both Goldman and BlackRock expanded in size. BlackRock’s headcount was 23% higher in 2022 than in 2019, while Goldman hired at twice the pace of the broader banking industry since the start of 2020.
Both institutions have seen a recent drop in earnings. Goldman’s fourth-quarter earnings are expected to have dropped by 8% in 2022. BlackRock’s assets under management totaled $7.6tn in the third quarter of 2022, down 16% from the previous year.
Elsewhere job cuts are also taking place outside of the financial sector, with Amazon recently announcing cuts for 18,000 members of staff.