NEW YORK – Months into the growing COVID-19 pandemic, the titan holders of the U.S banks including Morgan Stanley, Bank of America and many others had made a public vow to not reduce on work staff as 2020 occurred as it was considered immoral amidst the hardships that the pandemic forced the American people into.
Experts cite that bank economists and executives expect recovery from COVID-19 pandemic to cause widespread recession that would prompt layoff all over the banking sector despite past promises of no reduction of bank staff at the start of 2020. The unemployment has been predicted to go well into 2021 while interest rates would remain at zero until the economy heals.
Managers claimed that even with the forced layoffs, they are still able to operate with less employees.
“No question, layoffs (will) come across the board for all the banks. Banks have to cut costs because of expected credit issues, as well as low interest rates and regulatory pressure to trim dividends” said Chief Investment Officer Barry Schwartz.
“We didn’t see a lot of restructuring or layoffs with the banks (earlier in the pandemic). We’re starting to see it now. Things will get a little bit worse … and we might see an increase in restructuring.” said Partner-in-Charge Dennis Baden, at executive search firm Heidrick & Struggles.
Standard Chartered PLC and HSBC Holdings PLC made the decision to reduce their staff numbers by several hundred this year with actual projections to lay off more within the coming year.
Many banks opted to retain the staff numbers core teams by work-from-home set ups to further continue operations that gave results with better function by keeping the teams small and manageable.
“Everyone has been surprised by how much more efficient you can be. Later this year or early next year, (managers will) look around and say we just have many more people than we need.” said Johnson.
HSBC stated it was planning to cut 35,000 more jobs as the year continues with the capital-markets descending in the growth charts and soon to dip into the red unless they can find an alternative to working around the COVID-19 Pandemic financial crisis.
Wells Fargo & Co resumed laying off more people during August after pausing all cutting of jobs back in March where the majority of the staff were from the retail banking and technology sectors, with management still opting to lay off thousands more continuing into the year and possibly the next.
