January 29, 2023
Reuters

KEY POINTS

  • Junior bankers would reportedly obtain solely $10,000 to $15,000 in bonuses this 12 months
  • Bonus pay final 12 months for the workers reached six figures
  • The pay reduce comes amid the corporate’s latest huge layoffs

Goldman Sachs has slashed its employees’ bonuses by as a lot as 90 % after information in regards to the firm’s huge layoffs made rounds simply final week, a supply stated.

Based on sources by the New York Publish, junior bankers on Wednesday discovered that they might obtain solely $10,000 to $15,000 in bonuses in distinction to their six-figure bonuses final 12 months, even after working 100-hour weeks.

In 2022, the common analyst bonus reached $95,000, whereas these on the vice chairman degree acquired a median bonus of greater than $500,000, as per the outlet’s sources. The corporate additionally raised its first-year employees’ base pay from $85,000 to $110,000 and $210,000 to $250,000 for vice presidents.

The bonus pay reduce comes after the Wall Avenue firm’s huge layoff of over 3,000 workers hit the information final week. Reuters reported that the layoffs can be the most important for the reason that 2008 monetary disaster.

The layoffs will presumably have an effect on a lot of the financial institution’s main divisions, particularly Goldman Sachs’ funding banking arm, the outlet stated.

Staff who put in hours of labor are disillusioned on the latest information, in keeping with the New York Publish.

“All of us knew it was coming due to how a lot they’re chopping again,” one employee stated, in keeping with the New York Publish. “But it surely does not imply it makes it simpler.”

See also  Elon Musk Suggests Layoffs Might Come To Twitter

In the meantime, executives argued that the corporate nonetheless maintained their pay-per-performance tradition. Nevertheless, Goldman Sachs’ income reportedly slumped by 66 % final week in comparison with 2021.

“Whereas compensation bills have been down 15% for the 12 months… We all the time attempt to keep up a pay-for-performance tradition,” chief government David Solomon advised the New York Publish.

“With revenues down, compensation was decrease. That stated, we additionally acknowledge that we function in a talent-driven enterprise, and we should proceed to spend money on our folks whose dedication is essential to our world-class franchise.”

Earlier, Reuters reported that Solomon despatched a year-end voice memo to employees warning of a headcount discount within the first half of January. The corporate, nonetheless, declined touch upon the memo.

Chief Monetary Officer Denis Coleman additionally advised the outlet that general compensation was down 15 % and headcount was up 10 %, which means much less cash could possibly be distributed to the employees.

A view of the Goldman Sachs global headquarters in Manhattan, New York
Reuters