Goldman Sachs is preparing for a third round of layoffs that will involve some partners

Goldman Sachs is preparing for more layoffs in the coming weeks after cutting more than 3,000 jobs in the past year.

The layoffs could take place in the coming weeks and will also affect directors and senior executives. according to The Wall Street Journal,

It’s CEO David Solomon’s attempts to cut costs as deal making – the company’s main source of income – suffers from a drought exacerbated by an environment of higher interest rates and fears of a recession. He has begun cutting a workforce that has exploded in the wake of the pandemic.

These layoffs mark a third round of cuts in less than a year, starting with the standard annual September layoffs of a few hundred employees, followed by the cut of about 3,200 jobs at the company’s New York, Hong Kong, offices. and London in January. 6 percent of the workforce.

After the layoffs in the first quarter, the bank went from 49,000 employees to 45,000.

The layoffs could take place in the coming weeks, according to the Wall Street Journal, and will also affect directors and senior executives.

In January, the company posted its biggest profit loss in more than a decade as it tries to recover from the pandemic and a work-from-home and cost-of-living crisis.

The investment banking giant reported fourth-quarter 2022 net income that month of $1.33 billion, down 66 percent from last year and 39 percent below what Wall Street analysts had expected.

“Generally expected to be terrible, Goldman Sachs’ Q4 results were even more miserable than expected,” said Octavio Marenzi, CEO of consulting firm Opimas.

The real problem lies in the fact that operating expenses skyrocketed 11 percent, while revenues plummeted. This strongly suggests that more cost cuts and layoffs will follow,” he added at the time.

Other Wall Street banks are also making deep cuts in their workforces and streamlining operations amid the drought of the investment banking deal.

Morgan Stanley is cutting about 3,000 workers this quarter, while Bank of America said on its latest earnings call it planned to cut 4,000 jobs by June — that’s 2 percent of its workforce.

Goldman’s investment banking costs fell 48 percent in the last quarter of 2022, while its wealth and asset management unit’s revenues fell 27 percent due to lower income from equity and debt investments.

It also reported a pre-tax loss of $778 million in its platform solutions unit, which includes transaction banking, credit card and financial technology companies, including Apple Card and fintech lender GreenSky.

Full-year net loss for the platform solutions business was $1.67 billion, the bank said.

Goldman shares fell more than 5 percent in January morning trading

Goldman Sachs’ workforce rose to 49,100 last year. Even after the company laid off 3,200 people, it still had more employees than in 2021

In the January layoffs, many Goldman employees received little notice and were fired without even receiving a bonus for their work in 2022, the Financial Times reported.

The employees were reportedly fired through meetings and phone calls, with their office badges deactivated as they were escorted out of the buildings. The company will also send personal items to the laid-off employees who were out of the office.

“We know this is a difficult time for people leaving the company,” Goldman said in a statement. “We are grateful for the contributions of all our people and we are providing support to ease their transition.

“Our focus now is to make the company fit for the opportunities ahead in a challenging macroeconomic environment.”

About a third of those laid off at the time were from the Investment Banking and Global Markets division, and some of the laid-off workers also relied on the job for their visas.