Goldman Sachs to layoff vice presidents, citing over-hiring in recent years
Goldman Sachs is set to reduce its workforce by 3% to 5%, marking a shift in the timing of its annual job cuts. Unlike previous years, when layoffs typically occurred in the latter half of the year, this round is expected to take place in the spring.
The latest downsizing primarily targets vice presidents, a position where the firm believes over-hiring has taken place in recent years. Some employees have reportedly been given subtle indications of their job security being at risk, including lower-than-expected bonuses and weaker performance evaluations.
A Goldman Sachs spokesperson confirmed that the move is part of its routine talent management process but did not disclose further details.
With a headcount of 46,500 at the close of 2024, Goldman Sachs remains focused on maintaining operational efficiency while keeping overall staffing levels stable through continued hiring in key areas. The firm has been managing expenses carefully following a period of declining profitability in select business segments.
The upcoming cuts follow a series of layoffs in 2023, which were largely attributed to a slowdown in dealmaking and the firm’s decision to retreat from its consumer banking venture. However, recent financial results have signaled a turnaround, with Goldman Sachs reporting its strongest quarterly profit in over three years, driven by improved performance in investment banking and trading.
CEO David Solomon has emphasized that the firm is prioritizing efficiency as part of a long-term cost management strategy. “We believe there are significant opportunities to drive further efficiencies,” Solomon stated earlier this year, reinforcing Goldman Sachs’ commitment to streamlining its operations.
A renewed focus on core divisions such as investment banking, trading, and wealth management has been instrumental in boosting the firm’s stock price by 45% over the past year. Analysts point to this strategic realignment as a key factor in Goldman’s financial resurgence following costly missteps in retail banking.
Beyond this round of job cuts, the firm’s long-term workforce strategy is expected to be shaped by advancements in artificial intelligence and automation. Goldman Sachs recently introduced an AI-powered assistant for bankers, signaling a broader shift toward technology-driven efficiencies. As automation becomes more prevalent, operational and back-office roles could face additional restructuring in the coming years.
Despite the layoffs, Goldman Sachs remains focused on long-term growth, aligning its workforce strategy with evolving market demands while leveraging technology to enhance productivity. The firm’s latest workforce adjustments reflect a larger industry-wide trend of financial institutions balancing cost control with future investment in digital innovation.