Goldman Sachs is reportedly bracing for layoffs that will impact employees companywide
- Goldman Sachs is preparing to layoff workers as soon as next week, The New York Times reported.
- The publication cited two sources familiar with the plans that said the cuts will be companywide.
Goldman Sachs is preparing to initiate a round of layoffs that could start as soon as next week, according to a recent report from The New York Times.
The publication cited two people with knowledge of the matter who said the terminations will impact workers companywide.
A spokesperson for Goldman Sachs declined to comment on the report.
The bank usually initiates a round of layoffs, called Strategic Resource Assessment," or "SRA," on an annual basis based on employee performance — terminating anywhere from one to five percent of staff. Insider's Reed Alexander previously reported that the extensive performance review process requires employees to rate each other on anything from how well the worker represents Goldman Sachs' culture to how the individual handles risk. Workers can pick up to eight other employees to vouch for them in the review process, which has been described as stressful and lengthy.
Goldman Sachs temporarily paused the initiative during the pandemic as dealmaking soared and banks showered employees with record bonuses and benefits. Meanwhile, junior bankers have complained of being overworked and underpaid.
The news comes after the bank reported in July that investment-banking revenues had declined by about 41% from the same period the previous year and warned it was slowing hiring. At the time, the company's chief financial officer, Denis Coleman, said Goldman Sachs will "probably" restart its annual employee performance reviews at the end of 2022.
In July, Goldman Sachs CEO David Solomon said the bank sees a 50% chance of recession in the next two years.
"We're suggesting that the chance of recession is higher now than it's been in quite some time, and everybody needs to be a little bit cautious," Solomon said in an interview with CNBC.
Wall Street could be in for a new era of belt-tightening as IPOs and SPACs fall. JP Morgan already began cutting its staff in June. Morgan Stanley slashed investment bankers' pay by 21% in July, while BlackRock has already slowed hiring.
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