Why Are Layoffs Sweeping Through Wall Street?

A new year usually brings new opportunities. For some financial professionals, they had no choice. 

Layoffs have swept through Wall Street this week, impacting thousands of employees from the world’s biggest banking institutions. 

Goldman Sachs slashed 3,000 jobs, while BlackRock laid off up to 500 employees. But the big question is: why now? 

Last year was defined by record-high inflation, a tight job market, global conflict, growing interest rates and an overall disappointing year for the market. As a result, a recession has become all but inevitable, leaving companies from nearly all industries scrambling to right-size operations and alleviate future losses. 

Although Goldman and BlackRock’s layoffs made up a relatively small portion of their overall workforce — 6.5% and 3%, respectively — it harkens back to pre-pandemic annual cullings that the industry was once accustomed to.

Layoffs aren’t unique to the banking industry, either. Big Tech layoffs have also shaken the foundation of the normally reliable industry.