Bank stocks have done especially well in the post-election Trump rally. Analysts at Morgan Stanley (MS) expect bank profits in 2017 to be up by a median estimate of 22%, as reported by Bloomberg. This rosy scenario is driven by expectations for higher interest rates, lower corporate taxes and less restrictive regulation under President Trump. (For more, see also: How Will Rate Hikes Impact the Banking Sector?)

However, this is cold comfort for bank employees. A drive to cut costs through automation remains in full swing, with significant job reductions still on the horizon.

Have Banks Hit Peak Human?

During the first ten months of 2016, banks eliminated about 19,400 positions. Data compiled by outplacement firm Challenger, Gray & Christmas, Inc. indicates that the cumulative toll since the financial crisis of 2008 has been about 600,000 jobs lost. But the worst may be yet to come.

A research report from Citigroup Inc. (C) in March forecasted the elimination of 1.8 million bank jobs in the U.S. and Europe within the next ten years, according to an earlier Bloomberg article. Advances in cloud computing and artificial intelligence (AI) are replacing humans with computer algorithms in a growing number of highly skilled roles. Thus, the future job losses will go far beyond low-paid tellers and back office clerks.

For example, “robo-advisers,” or automated portfolio managers, are already overseeing about $50 billion of assets, another Bloomberg article reports. This is a tiny sliver of the $20 trillion wealth management market, but it is growing rapidly, even among wealthy clients with $1 million or more to invest. The brokerage divisions of Morgan Stanley, Bank of America Corp. (BAC) and Wells Fargo & Co. (WFC) are under increasing pressure to justify their fees, and developing robo-adviser alternatives is an obvious option. These firms collectively employ about 46,000 human financial advisers. (For more, see also: Passive Funds Are Killing Active Money Managers.)

Hiring Bright Spots

If there is any bright spot on the horizon for hiring at banks, it is for programmers who can design such expert systems. Additionally, big banks are investing in financial technology (fintech) startups, partnering with them, or even acquiring them.

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