Goldman to Axe 3,200 Workers

Cuts come as annual profit may have slid by half in 2022

By
Nathan Reiff
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Nathan Reiff has been writing expert articles and news about financial topics such as investing and trading, cryptocurrency, ETFs, and alternative investments on Investopedia since 2016.
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Published January 09, 2023
Goldman Sachs name next to ticker
Photograph of Goldman Sachs logo in front of a ticker.

Goldman Sachs Group Inc. (GS) will cut about 3,200 positions starting this week, reversing course after four years of expansion, as a weak economy and slower dealmaking may have cut annual profit by half last year.

Key Takeaways

  • Goldman Sachs will lay off about 3,200 workers starting this week, its largest round of cuts in years.
  • The firm is expected to see profits fall by almost half for 2022, although strong revenue is predicted thanks to its trading division.
  • Goldman's headcount ballooned by more than a third to 49,000 by this past fall, as the company reduced annual cuts during the pandemic.

The cuts, amounting to about 7% of its total employees, are coming largely from its banking and trading divisions after the firm boosted its workforce by more than a third over the past four years to 49,000. Goldman mostly paused its yearly cull of underperforming employees earlier in the pandemic.

They also arrive just days before Goldman's annual year-end bonus discussions. Compensation across the company is expected to fall as the bank works to reduce overall expenses. Firms across Wall Street have suffered along with declining asset prices and lower merger activity in the past year, and analysts say profit dropped by about half last year even as its trading units drove $48 billion of revenue.

Goldman's cuts surpass those of rivals. Morgan Stanley (MS) and Citigroup Inc. (C) are among a growing list of financial firms that have announced large-scale layoffs in recent weeks. Goldman last announced big cuts in September.

Article Sources
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  1. Bloomberg. "Goldman to Cut About 3,200 Jobs This Week After Cost Review."

  2. Wall Street Journal. "Goldman Sachs Plans To Cut 3,200 Jobs Starting This Week."

  3. Washington Post. "Big Bank Job Cuts May Just Be Getting Started."

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