With the economic future looking bleak, David Solomon, the CEO of the giant investment firm Goldman Sachs hinted at massive job cuts. The company is all set to eliminate at least 8% of the workforce, which equals 4,000 employees.
The decision came at the start of 2023 when the CEO announced what was later termed a “massive job cut” in the history of Goldman Sachs. According to the initial reports, the elimination of Goldman employees would be effective by the end of the month.
However, it is essential to note here that the decision to eliminate Goldman employees came after the revenue slump of the firm. On December 28, 2022, the company released a detailed report on the third-quarter revenue of the investment firm. According to the report, the 3Q revenue of Goldman decreased by 22%.
To cope with this revenue slump, Goldman made the decision that the firm would be laying off its employees. Citing other reasons, the CEO noted that the looming recession and rising inflation rate are other players that are forcing the firm to eliminate its employees. Nevertheless, it is essential to note here that this was “just a hint” coming from the CEO of Goldman.
Some of the credible sources familiar with the matter state that the managers at Goldman will “try hard” to lower the final number. And maybe, the company will be working on recovering from the profit slump through other strategies. But so far, what the CEO had said was pristinely clear: The company was to eliminate at least 8% of the workforce. In other words, Goldman Sachs would be firing at least 4,000 existing employees.
Nevertheless, it is essential to note that investors are moving cautiously as the inflation rate rises and the recession looms. They are taking every stock and investment with a pinch of salt. Prior to investing in any form of an investment portfolio, they are thinking twice – if not thrice.
And the same is true for investment firms. According to a report from Statista, Goldman Sachs has been struggling with its investment banking, portfolios, and revenues. Throughout the outgoing year 2022, Goldman Sachs saw a massive revenue and profit drop.
Now, to overcome this loss, the company has to take some “bold” actions, as hinted at by the CEO. Other investment banking firms in the U.S. have either laid off their employees or are in the process of doing so. Credit Suisse Group, Morgan Stanley, and Barclays Plc are some of them. And now, Goldman Sachs is joining the trend.