Goldman Sachs CEO David Solomon’s plan to reorganize the bank’s corporate structure is raising alarm bells — with junior bankers fearing it could cost them their jobs, sources told The Post.
Earlier this week, reports citing anonymous sources said the Wall Street giant was combining its various business units into three divisions — and that one of them would house both the trading and investment banking, the bank’s two most prestigious and competitive operations.
Goldman confirmed the plans as it announced quarterly earnings on Tuesday — with Solomon telling CNBC in an interview that there’s a “good chance” of a recession as the bank mounts its overhaul. The corporate rejiggering is also consolidating the consumer banking businesses, including its struggling Marcus division.
“It’s just weird finding out about your job or division being merged or changed by reading the news instead of hearing it from the firm leadership or your boss,” one Goldman employee who spoke on the condition of anonymity told The Post. “It begs the question… will we all keep our jobs?”
“A new reorganization increases intensity for management and employees to produce…this gives wiggle room to cull a few more,” Mike Mayo, banking analyst at Wells Fargo told The Post. “They could be deciding which people are redundant.”
In September, Goldman Sachs began laying off workers across the US amid a downturn in dealmaking as the economy slows, according to reports at the time. Before the pandemic, Goldman annually culled 1% to 5% of under-performers from its workforce every year but halted the firings as business boomed during the pandemic.
September’s layoffs were on the lower end of that range, a source with knowledge told The Post, but still represented a stark change from just a year ago, when the bank was hiking salaries and bonuses in a bid to meet a dire talent shortage across the industry.
But some employees — who had been hopeful they’d be safe for a few months — are once again on tenterhooks.
“Anytime a company reorganizes itself it means getting rid of redundancies,” another insider told The Post. “So people are frightened — and rightfully so.”