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This 153-Year Old Company will start Firing Employees (See Reason)

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Goldman Sachs, a banking giant, is set to fire hundreds of its employees within the next week.

In fear of a recession, it and other companies have been mass-laying off employees.

Revert to pre-pandemic practice

Goldman Sachs’ layoffs are a return of its annual practice, which was stopped in the past two years because of the pandemic.

The Wall Street giant usually reduces its staff by 1% to 5% each year. The 2022 cuts are likely to be lower, stateda source.

The company’s global headcount was more than 47,000 at the end June, before the layoffs.

This was an increase of 15% over the same period last year.

Previous warning

Experts think that the company could fire up to 5% of its low-performing employees.

This could mean that around 500 to 2400 employees will lose their jobs.

During an earnings call in July, Denis Coleman, Chief Financial Officer, warned that the company may slow down hiring as a result of cost cutting, given the worsening economic outlook.

Other Wall Street banking giants, such as Citigroup and JPMorgan Chase & Co., Wells Fargo & Co., have also ended the contracts of their employees in order to downsize.

“Best Use of Resources”

“Given the challenging operating environment, we are closely re-examining all of our forward spending and investment plans to ensure the best use of our resources,” said Coleman.“Specifically, we have made the decision to slow hiring velocity and reduce certain professional fees going forward, though these actions will take some time to be reflected in our results,” he further added.

Coleman stated that the company suffered a 48% slump in quarterly profits, which forced it to take tough decisions.

Factors that affect companies

Apart from the impending recession, companies around the globe are facing many other challenges, such as uncertain macroeconomic conditions and the ongoing Russia-Ukraine conflict.

Apart from the annual traditionof trimming the employee count by Goldman Sachs, it is expected that the company will also bring back its annual performance review for employees by the year’s end.

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