In addition to the yearly weeding out of underperformers, this year Goldman Sachs is going to lay off hundreds of people as it braces for a recession. Although no specific figure has been officially announced, Financial Times reported that in addition to job cuts, the Company intends to discontinue the personal loans offered via its retail banking platform, Marcus. According to Bloomberg, at least 400 jobs are likely to be axed.
Every year, the Bank does resort to strategic resource assessment or SRA, wherein about one to five per cent of the workforce is asked to leave based on their performance. This year, however, there will be additional reduction in headcount.
The investment banking sector had witnessed a significant slowdown. And with fears of a recession looming large, the Bank is only doing what most other global companies are doing — preparing itself for difficult times.
Two months ago, there were media reports of Goldman Sachs planning to restructure. It was reported that its consumer division would be split into two, with Marcus under the wealth-management division and retail banking operations under the platform solutions division.
In July 2020, amidst the pandemic, the Bank had introduced a new grading system, which also required staff to undergo performance checks with their team leads and bosses at least thrice a year, with effect from 2021.
At the time, the Bank had maintained that this new system of performance management will only provide new opportunities for transparency in communication, feedback and coaching, and that it would not promote job cuts.
