Citing sources familiar with the situation, the Financial Times reported on Thursday that Goldman Sachs is preparing for yet another wave of job layoffs for staff who are considered underperformers, which may occur as early as late October.
The strategy would normally result in job losses of between 1% and 5% of employees across the entire company and Goldman is aiming for a number at the lower end of the range in several of its key investment banking and trading departments, based on the report.
According to a source with knowledge of the situation, this is an annual practice the bank conducts as a part of performance appraisals. After the pandemic in 2020 and 2021 forced the bank to postpone the appraisal, it was resumed last year.
According to prior reporting, the bank lay off 500 staff members in September 2022.
The managing directors of Goldman Sachs were summoned to a meeting in June when they were given a grave directive: take more painful measures to cut costs.
Belt-tightening is another indication that the company's continuous effort to save $1 billion in costs is now intensifying as management target smaller and smaller line items and consider further job layoffs. The topic of belt-tightening is often on the agenda for conferences of Goldman's senior executives.
In the first quarter, Goldman made the most layoffs since the 2008 financial crisis, cutting nearly 3,200 jobs from its workforce. Additionally, in May, it eliminated 250 workers.
As a result of writedowns in its customer businesses as well as investments in real estate, the Wall Street giant's profit fell 60% in the second quarter of the year, underperforming projections.