Goldman Sachs insiders' advice on being laid off: don't rest
Goldman Sachs is laying off 3,200 people this week, and it goes without saying that people inside the firm are not happy about it. These are Goldman's most dramatic round of cuts for years ("ever", according to Zero Hedge) and the breadth of the reduction in force (RiF) has taken people by surprise.
"It's been a classic situation of, "Everyone give me three names," a senior Goldman trader in New York tells us.
Goldman's cutting 6.5% of 49,100 or so people it employed at the end of the third quarter. The firm isn't commenting on the distribution of its cuts by division, but insiders say almost equal numbers will go in global markets as in the most poorly performing areas like consumer banking and the investment banking division.
This breadth of the cuts is causing consternation in global markets, which had an exceptional year in 2022. "There is zero consideration for return on investment," says the trader. "80% of these cuts should have been in the consumer division, which is clearly a shitshow."
Goldman is, however, tackling the loss-making consumer division that's been the darling of CEO David Solomon and others. Ericka Leslie, the bank’s chief administrative officer, is reportedly orchestrating the cuts there, and is working with Stephanie Cohen to set up a platform solutions business which will include consumer banking (AKA Marcus) and trim its costs. Cohen is a close protégé of Solomon and has been running the consumer business since October 2020.
While the cuts to the global markets business may seem unwarranted, Goldman insiders say they'renecessitated by the absence of widespread layoffs during the pandemic. The firm is making up for lost time.
While Goldman people wait to get the call, one ex-GS managing director offers some advice on what to do when it comes. Whatever you do, don't rest, he says: "Avoid the temptation to take a break. Get hustling immediately."
With luck, a new position should be forthcoming soon. "The GS badge is as good as it gets, so stay confident," he adds.
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