Daily Management Review

Banks around the world announce largest staff reductions since 2015


Banks around the world are announcing job cuts, which could be the biggest in four years, cutting back on spending amid a slowdown in the global economy and a shift to digital, Bloomberg writes.

According to the companies and trade unions cited by the agency, this year more than 50 banks announced a reduction of a total of 77,780 jobs, which is the highest figure since 2015, when 91,448 people fell under the reduction. Banks in Europe, which are experiencing additional stress in the face of negative interest rates, account for approximately 82% of the total volume of reductions. 

Taking into account the indicator for 2019, the total volume of reductions in banks over the past six years will exceed 425 thousand jobs. However, as Bloomberg notes, the real number may be even higher, as many banks lay off employees without disclosing their plans. 

The last of the banks to announce staff reductions was Morgan Stanley, one of the largest US banks, which intends to lay off about 1,500 employees, according to Bloomberg sources familiar with the bank’s plans. Morgan Stanley CEO James Gorman said the bank would cut about 2% of the staff. 

Unlike the United States, where government programs and rising interest rates allowed banks to recover quickly from the financial crisis, banks in Europe still cannot fully recover. Many of them have to lay off employees and sell assets in order to maintain profitability. 

source: bloomberg.com