Goldman Sachs CEO's Grim Year-End Message: "Layoffs in January"

"72% of Wall Street Bankers Would Quit if Bonuses Cut, Survey Draws Attention"

[Asia Economy Reporter Haeyoung Kwon] The American investment bank (IB) Goldman Sachs is set to carry out a large-scale additional layoff next month. As the global economy is expected to enter a full-scale recession next year, a wave of layoffs is sweeping Wall Street. Amid this, a significant number of Wall Street employees have stated that they would consider quitting if their bonuses are cut.

According to Bloomberg on the 27th (local time), David Solomon, CEO of Goldman Sachs, said in his year-end message to employees, "We expect layoffs to occur before mid-January," adding, "There are many factors affecting the business environment, including monetary tightening that slows economic activity. Management is focusing on preparing for headwinds."

Goldman Sachs also conducted layoffs of hundreds of employees in September, marking the first restructuring on Wall Street. CNBC predicted ahead of Solomon's year-end message that the scale of this layoff could reach up to 8% of Goldman Sachs' total workforce. With Goldman Sachs' workforce at approximately 49,100, up to 4,000 jobs could be lost.

In preparation for the economic shock next year, Wall Street is slimming down through layoffs. Following Citigroup and Barclays' consecutive workforce reductions, Morgan Stanley announced earlier this month a plan to lay off 1,600 employees, equivalent to 2% of its total workforce.

Meanwhile, Wall Street employees have drawn attention by stating they would consider quitting if their bonuses are cut next year.

A survey conducted by Fishbowl, a social networking application, targeting 1,096 employees from JP Morgan, Goldman Sachs, and Morgan Stanley, found that 72% of respondents said they would consider leaving the company if their bonuses were reduced next year.

Wall Street enjoyed record-breaking bonus celebrations in 2020-2021 due to the financial market boom from quantitative easing by major countries after COVID-19, along with record mergers and acquisitions (M&A) and initial public offerings (IPO) performances. However, as recent M&A and IPO performances have contracted, consulting firm Johnson Associates predicted that year-end bonuses this year will decrease by about 45%.

Alan Johnson, director at Johnson Associates, forecasted, "Most people believe this will be the worst year since the financial crisis."

This content was produced with the assistance of AI translation services.