Goldman Sachs fires mid-level bankers after dishing out bonuses and hiking salaries during pandemic

Goldman Sachs has launched a wave of massive layoffs of workers in the US after handing out soft bonuses and high salaries during the pandemic – amid an expected drop in revenue as the economy slows.

The Wall Street giant’s investment banking division launched the effort last week, according to a report, by firing hundreds of bankers in offices around the world as it looks to control costs and eliminate underperforming employees.

Workers at all levels were affected by the cull, sources said, with the center of gravity of the effort being felt by senior to mid-level staffers, such as several senior employees and vice presidents.

Nearly a dozen bankers in the prestigious bank’s technology, media and telecommunications divisions were fired alone.

Its consumer retail, healthcare and industrial divisions were reportedly all hit by layoffs, which were expected after the company said in July that it plans to delay hiring and reintroduce annual performance reviews. Bloomberg reported.

That announcement came as the bank recorded a marked 40 percent decline in profits this year alone after a brief business boom during the pandemic.

This spurred Goldman Brass to break the then-routine layoff process at the time and hand out a series of fancy perks in an effort to retain staff amid increased demand for workers across the industry.

Prior to the pandemic, Goldman removed about 1 to 5 percent of its staff from its workforce each year. This round of layoffs is at the lower end of that range, insiders have said — but it still represents a drastic turn of the company’s stance less than a year ago.

Prior to the pandemic, Goldman removed about 1 to 5 percent of its staff from its workforce each year. This round of layoffs is at the lower end of that range, insiders have said — but it’s still a drastic turn from the company’s stance less than a year ago, when it raised salaries and handed out perks.

It’s been “a tough week,” a source with knowledge of the investment firm’s inner workings told me Insider of the alleged layoffs, reported by the outlet on Friday.

An insider also told how earlier in the day, staff members of the company’s technology, media and telecommunications divisions were given pink slips at the end of the day from both New York and San Francisco officers.

Other divisions that have felt the impact of the cuts include consumer retail, healthcare, and industrials, according to sources.

All the talent was affected by the cull, said an insider, who revealed that workers of all levels were out of jobs — from the most junior bankers to the executives.

It was not immediately clear from the first reports how many staff members have been laid off, but it seems that the number is in the hundreds.

An insider told how buyers for the major bank were carefully calculating layoffs and not abandoning too many senior or junior employees.

‘It’s a balancing act. You can’t cut too many senior bankers because although they are expensive, they are the ones who bring in more business,” explains the source. “And junior bankers, yes they are cheaper, but if the general business is slow, they don’t have much work to do.”

The company had 47,000 employees at the end of the second quarter and a one percent reduction in headcount would mean a reduction of about 500 bankers.

The company has about 47,000 employees – and a one percent cut in its workforce would mean a reduction of about 500 bankers

The layoffs had already been anticipated after the company said in July it plans to delay hiring and reintroduce annual performance reviews.

Before the pandemic, Goldman cleared 1 to 5 percent of its underperformers annually, with sources since indicating this round is in that range, on the lower end.

That said, bankers from the company’s numerous offices abroad were also not spared – with about a dozen bankers in Goldman Sachs’ London office also being fired, a source told Financial News.

The company’s burgeoning Chinese branch — which last year employed 400 more to roughly double its workforce — had more than two dozen bankers laid off as a result of the recent cull, Reuters reported.

According to one source, employees cut from the company’s TMT team were invited to interviews with national-level group leaders, including:

Other partners may also have been involved in the exit interviews, this person added.

As news of the layoffs spread over the weekend, representatives of the stalwart Wall Street appeared in statements to various outlets to claim that the alleged layoffs, if they actually happened, would be a return to normalcy at the business. large bank would demonstrate.

“Every year, we conduct a strategic assessment of our resources worldwide and align the workforce with the current business environment,” a spokesperson told The New York Post. “We remain flexible as we execute on our strategic growth priorities.”

DailyMail.com contacted Goldman Sachs’ public relations department after the publication of this article for more details on the reported layoffs on Monday night.

The resumption of the layoffs comes in response to a dramatic drop in revenue, reported by the major bank and its CEO David Solomon, which posted a second-quarter profit of $2.93 billion in June.

The resumption of the layoffs comes in response to a dramatic drop in revenues reported by the major bank and its CEO David Solomon, who noted second-quarter profit of $2.93 billion in June.

The number came as a shock to some, including executives who had received a blessing during the pandemic, as it was significantly lower than the return recorded in the second quarter of 2021, when the bank brought in $5.49 billion.

Amid the dramatic decline, copper at the major bank took a variety of measures to save their profits — measures some workers labeled as stingy.

In April, the bank shook things up when it stopped offering free rides to and from the office for employees, as well as abolishing free breakfasts and lunches.

“Of course they took the coffee,” a source told The New York Post at the time, “but I’ve been so screwed since Labor Day that I haven’t really had time to think too much about it.”

The employee added that there was still free drip coffee in a lobby on the 11th floor, but it was of lower quality than the old, full-service coffee station and more difficult to access.

They also noted that Goldman was seemingly trying to sweeten the rough deal by giving bankers free cupcakes on their first day after Labor Day.

In April, Goldman Sachs stopped offering free rides to and from the office to employees and also abolished free breakfast and lunch.

In May, the company again seemingly tried to offer staffers a sweetener when it offered senior employees unlimited time off — a policy some critics at the time labeled a hidden agenda to keep pressured staffers working long hours while buyers try. for more bottom lines.

In August, Goldman informed its staff that it would scrap pandemic protocols, such as allowing remote work, with employees then expected to be in the office five days a week.

The announcement was the culmination of several months of taking away accommodations offered to employees to encourage them to come to the office when not required to do so.

Goldman isn’t the only bank struggling with their employees and offices.

At JP Morgan, CEO Jamie Dimon reportedly told senior staff that he expected junior employees to be at their desks five days a week, despite official policy only requiring them there three days a week.

But at Citigroup, CEO Jane Fraser enforces a ban on Zoom calls on Fridays, and still asks employees to come to the office just a few days a week without having to be there for five full days.

Brian Moynihan, CEO of Bank of America, has said the bank will announce office plans in the coming weeks.