Goldman Sachs has begun cutting 3,200 jobs, laying off employees in just 30 minutes at its offices in New York, London and Hong Kong.
When the mass layoffs began on Wednesday, many employees were laid off without even receiving any bonuses for their work in 2022, the Financial Times reports.
Staff were reportedly stripped of 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 workers who were out of the office.
The investment banking giant is poised to lay off around 6.5 percent of its 49,000 employees as CEO David Solomon seeks to cut spending amid shrinking revenue.
“We know this is a difficult time for people leaving the company,” Goldman Sachs said in a statement. “We are grateful for the contributions of all our employees and offer support to ease their transitions.
‘Our focus now is on properly sizing the company for the opportunities ahead in a challenging macroeconomic environment.’
Goldman Sachs began shedding 3,200 jobs on Wednesday as CEO David Solomon (pictured) looks to cut spending as banks reel from a tough 2022
Goldman Sachs’ workforce grew to 49,100 last year. Even if the company were to lay off 3,200, it will still have more employees than it will in 2021
Pictured: Employees at Goldman Sachs’ New York office on Wednesday as the first round of layoffs began. Employees were reportedly booted out in short meetings and with no bonuses
Sources told the Times that many of the sacked senior executives will still be paid until the end of January, while bonuses have been withheld, and will then receive a three-month severance package.
The younger employees, those at the vice president level and below, have only been offered a two-month severance package, the sources said.
Some Goldman Sachs employees have said the lack of bonuses this year could be a ploy by the bank to get more workers to quit so they can avoid severance pay while cutting more jobs.
About a third of those laid off were from investment banking and global markets, and some of the laid-off employees also relied on the job for their visas.
Shilpi Soni, a former software engineer at the company, said that after being booted out of the company, she was desperate for a new job so she could stay in the US.
“I just want to share how quickly life can be turned upside down,” she wrote on LinkedIn. “I am proud to be the first person in my family to pursue a Masters in a foreign country.
“Coming from a rural family, it was a roller coaster of overcoming social and financial limitations to get here. Knowing where I started hurts to be fired.
Shubham Sahu, 23, said he was potted just after his birthday and wrote: “Wow that’s really a different way to start a year…”
Many of the jailed employees shared their disbelief on LinkedIn, while others noted their visas were in jeopardy after suddenly losing their jobs
Another software engineer, Raunak Narayan, said his entire team was laid off, writing: “My current employer, Goldman Sachs, laid off my entire team (some of the best people I’ve worked with) and abandoned the project. Puts me in grave danger.’
Claire Davis, a former member of the banks’ product management department, said morale may be low among the amateur employees flooding LinkedIn.
“I am with you for my colleagues at Goldman Sachs who have been impacted,” she wrote. “I’m happy to help review resumes, take a call, or grab a cup of coffee.”
Goldman’s layoffs began Wednesday in Asia, where the company completed the dismantling of its private wealth management business.
It eventually fired 16 private banking employees at its offices in Hong Kong, Singapore and China, according to a source familiar with the matter.
About eight employees have also been laid off at Goldman’s research department in Hong Kong, the source added, with layoffs in investment banking and other departments afoot.
Layoffs began in Asia, including Goldman Sachs’ Hong Kong branch (above).
In the UK, employees also left their London office (above) to comfort one another in local pubs
Rainfall reduced the prospect of staff gatherings at Goldman’s central London hub.
Several security guards were actively patrolling the entrance to the building, but few people entered or exited the property.
A peek into the bank’s leisure area just beyond the lobby showed a handful of employees in deep conversation, but few signs of drama.
However, at the Harrild & Sons pub, near the bank’s Plumtree Court offices, some of the sacked staff were seen gathering while comforting one another.
In New York, employees were seen pouring into the headquarters during the morning rush.
Banks generated nearly $71 billion in US investment banking revenue last year, according to Dealogic. Investment banking revenue in the United States is expected to have fallen more than 50 percent from a year earlier
Goldman Sachs shares fell sharply on Wednesday after reports of the layoffs
Last month, CEO Solomon reportedly sent a memo to employees at the end of the year warning that headcount will be reduced in the new year.
“We are conducting a careful review and while talks are ongoing, we expect our downsizing to take place in the first half of January,” Solomon said in the memo, according to Bloomberg.
‘There are a variety of factors affecting the business landscape, including tightening monetary conditions slowing economic activity. Our leadership team is focused on preparing the company to weather these headwinds,’ he added.
Goldman Sachs had significantly increased its workforce since 2020 as it looked for growth opportunities in the wake of the pandemic.
However, institutional banks have been hit by a significant slowdown in activity in recent months due to volatility in global financial markets.
The annual bonus season is set to kick off this week when JP Morgan, Citi and Bank of America all report their results for the past year.