Connect with us

Finance

It’s nothing personal: On Wall Street, layoffs are a way of life

Published

on

It’s nothing personal: On Wall Street, layoffs are a way of life

Emma Alexander was just lately laid off from Goldman Sachs, together with over 3,000 different workers. Though the layoffs have been unusually giant this yr, they’re an ever-lurking prospect for individuals who work in finance.

Allison V. Smith


conceal caption

toggle caption

Advertisement

Allison V. Smith


Emma Alexander was just lately laid off from Goldman Sachs, together with over 3,000 different workers. Though the layoffs have been unusually giant this yr, they’re an ever-lurking prospect for individuals who work in finance.

Allison V. Smith

Just a few days earlier than Goldman Sachs laid off greater than 3,000 workers, Emma Alexander and her coworkers have been feeling nervous.

Information that the layoffs have been coming had already leaked, and anxiousness throughout Goldman’s world places of work was excessive.

Advertisement

Then, Alexander bought a message from her boss, asking her to return to the convention room.

“And I used to be like, OK, nice,” she recollects. “I assume it is me. I assume it is taking place proper now.”

Twenty minutes after assembly her boss, Alexander turned in her badge, and she or he left her workplace in Dallas for the final time.

She’d been swept up within the largest spherical of job cuts at Goldman because the World Monetary Disaster. The storied financial institution laid off greater than 3,000 employees final month.

The excessive tempo in Wall Road

It wasn’t Alexander’s dream to work in banking. She was a sociology main, who has a grasp’s diploma in public coverage.

Advertisement

Alexander says she took the primary job she might get after graduating in 2020, simply when the pandemic was beginning to unfold. However she grew to like finance’s fast-paced and aggressive tradition.

For Alexander, getting reduce was a impolite introduction to a different actuality of Wall Road life: layoffs.

Few sectors are extra vulnerable to layoffs than finance, the place a nasty yr within the markets — or a awful efficiency overview — can imply you might be out of a job.

In line with a 2021 report from the Workplace of the New York State Comptroller, the securities business has skilled job losses in 13 of the previous 30 years when knowledge is out there, or practically as soon as each two years.

When your job is hitched to how markets carry out

Like its rivals, Goldman Sachs has been navigating a tough atmosphere, with excessive inflation and rising rates of interest, and uncertainty about the way forward for the U.S. financial system.

Michael M. Santiago/Getty Pictures

Advertisement


conceal caption

toggle caption

Michael M. Santiago/Getty Pictures


Like its rivals, Goldman Sachs has been navigating a tough atmosphere, with excessive inflation and rising rates of interest, and uncertainty about the way forward for the U.S. financial system.

Advertisement

Michael M. Santiago/Getty Pictures

Getting reduce is a part of an understood however unwritten rule, in keeping with Wall Road workers: The pay is excessive — a first-year affiliate at Goldman, as an example, makes greater than $150,000 a yr, not together with a bonus — however with that compensation, comes the understanding that getting reduce is an ever current threat.

“It all the time occurs,” says David Stowell, a professor of finance at Northwestern College, who spent most of his profession at Goldman. “There’s anticipated to be some cuts each single yr at most Wall Road corporations.”

Nonetheless, Goldman’s layoffs have been unusually giant this yr.

Due to excessive costs, rising rates of interest, and financial uncertainty, a lot of Goldman’s company purchasers have been sitting on the sidelines, and because of this, earnings on the Wall Road agency have dropped dramatically.

Advertisement

The efficiency of economic corporations is linked closely to how markets carry out, as is the destiny of its employees. It is a actuality on Wall Road that may be irritating on the subject of layoffs.

“The monetary markets are unpredictable and cyclical,” Stowell says. “So, you reside and die with the markets.”

The efficiency overview

Underneath the management of Goldman Sachs CEO David Solomon, the agency’s headcount had grown dramatically. Earlier this month, Goldman laid off greater than 3,000 workers.

Patrick T. Fallon/AFP by way of Getty Pictures


conceal caption

Advertisement

toggle caption

Patrick T. Fallon/AFP by way of Getty Pictures


Underneath the management of Goldman Sachs CEO David Solomon, the agency’s headcount had grown dramatically. Earlier this month, Goldman laid off greater than 3,000 workers.

Patrick T. Fallon/AFP by way of Getty Pictures

However the bigger-than-usual layoffs introduced by Goldman this yr additionally marked one other aspect of Wall Road life that has returned: annual efficiency critiques.

Advertisement

In Wall Road, they’re are notoriously exhaustive and consequential. Not solely are these assessments used to find out the dimensions of your bonus, but in addition, whether or not you’ll preserve your job.

Yearly, bankers are evaluated by their friends, bosses, and subordinates. The agency measures how a lot cash they introduced in, and the way nicely they labored with their teammates.

Underperformers are usually let go. It makes the efficiency overview an especially highly effective instrument for administration, in keeping with Stowell.

“In my expertise, a bit of concern is nice,” he says. “It motivates you to do higher.”

It nonetheless stings

In 2016, John Gooden was a part of a spherical of layoffs at Financial institution of America. “They have been part of life,” he says. “I simply did not assume at that time it might have been me.”

Courtesy of John Gooden

Advertisement


conceal caption

toggle caption

Courtesy of John Gooden


In 2016, John Gooden was a part of a spherical of layoffs at Financial institution of America. “They have been part of life,” he says. “I simply did not assume at that time it might have been me.”

Advertisement

Courtesy of John Gooden

The prospect of getting reduce could also be one thing workers reside with, however when it occurs, it nonetheless stings.

John Gooden discovered that lesson in 2016, when he was a second-year affiliate at Financial institution of America.

One September, on his commute to the workplace, he discovered that his agency had began layoffs. Just a few hours later, Gooden met the identical destiny.

“I used to be fully caught off guard,” he says. “It sort of knocked the wind out of me, and I did not actually know what to do.”

Advertisement

Gooden remembers staggering across the workplace, and saying goodbye to some members of his staff. He did some soul-searching. Then, Gooden began calling his contacts, and sending out copies of resume.

“After you sort of lick your wounds a bit, you have to get again to it,” he says. “Particularly me. I had a household to assist.”

Gooden bought again on his toes, and 6 years later, he’s nonetheless engaged on Wall Road.

Bouncing again

Emma Alexander did not dream of a profession in finance, however she shortly got here to like her job at Goldman Sachs.

Allison V. Smith for NPR


conceal caption

Advertisement

toggle caption

Allison V. Smith for NPR


Emma Alexander did not dream of a profession in finance, however she shortly got here to like her job at Goldman Sachs.

Allison V. Smith for NPR

Advertisement

Alexander additionally remembers being “in a state of shock” after her supervisor advised her she was being let go.

“I took it fairly arduous,” she says. “I used to be fairly upset.”

Alexander estimates the complete ordeal lasted about 20 minutes. She had a quick assembly along with her staff, after which, she was escorted out of the constructing. Alexander did not have time to complete up emails she was writing, and she or he wasn’t capable of hand off work in progress.

The subsequent few days have been tough, she says. At the moment, she is making use of for jobs in finance, mulling over what might come subsequent.

“I am in it now, and I find it irresistible,” she says. “However I am additionally questioning if possibly I must be taking a while and occupied with going again and doing one thing that possibly I studied for, and went to high school for.”

Advertisement

At the moment, Alexander remains to be searching for work — open to the likelihood it is probably not on Wall Road.

Continue Reading
Advertisement
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Finance

Online event: Digital Finance Platform – Launch of phase II & data hub

Published

on

Online event: Digital Finance Platform – Launch of phase II & data hub

When: 21 March 2024 between 09:30 and 11:00

Don’t miss this online event that will launch the second phase of the Digital Finance Platform, a collaborative space bringing together innovative financial firms and national supervisors to support new thinking in the EU’s financial system.

A key novelty in this second phase is the Data Hub, which provides participating firms with access to synthetic supervisory data for the purpose of testing new solutions and training artificial intelligence and machine learning models.

The event will also take stock of the current state of play of digital finance and look forward to the way ahead.

Continue Reading

Finance

Charting the AI revolution: Accelerating adoption of AI in finance – The CFO

Published

on

Charting the AI revolution: Accelerating adoption of AI in finance – The CFO

The finance function within organizations is undergoing a significant transformation as the pace of technological advancement is unprecedented, with CFOs at the forefront of this change. They are faced with navigating through the complexities of integrating Artificial Intelligence (AI) into their operations. The adoption of AI in finance is not merely a trend but a strategic imperative that promises enhanced efficiency, accuracy, and insights. This article delves into the ways CFOs can accelerate AI adoption in their finance functions, the challenges they might face, and strategies to overcome these hurdles for a seamless transition into the AI-powered future.

Strategies for Accelerating AI Adoption

To expedite the integration of AI within finance functions, CFOs can adopt several strategic approaches.
Initially, focusing on automating the financial fundamentals is paramount. By automating manual processes across accounting and finance functions, organizations can significantly enhance productivity. This step is crucial in addressing the ongoing accountant talent shortages and improving business visibility through more frequent reporting.
Furthermore, centralizing data and training your own AI models is another vital strategy. An integrated solution, such as a cloud ERP system, can unify data across the business, providing a single source of truth. This approach not only saves time on manual data integrations but also ensures that AI can be as effective as possible.
By starting small and encouraging AI experimentation, CFOs can gradually build a robust foundation for AI within their finance functions, driving long-term change and efficiency.

Overcoming Challenges in AI Integration

Integrating AI into finance functions is not without its hurdles. One significant challenge is the lack of understanding and trust in AI technologies among small businesses, as highlighted by UK Tech Minister Saqib Bhatti. To overcome this, promoting trust and transparency in AI applications is essential. This involves providing increased support and educational resources to help businesses navigate the complexities of AI. Additionally, addressing environmental concerns associated with AI, as noted by Tom Dunning, CEO of Ad Signal, is crucial. Businesses must be mindful of the carbon emissions caused by AI and seek solutions to mitigate its environmental impact. Collaborating with industry and government to ensure the safe development of AI and equipping staff with the necessary skills to harness AI’s benefits positively are also key strategies. By tackling these challenges head-on, CFOs can facilitate a smoother integration of AI into their finance functions, unlocking new avenues for growth and efficiency.

Advertisement

The Future of AI in Finance

The integration of AI into finance heralds a transformative era of efficiency, insight, and growth. As CFOs navigate this journey, the focus on strategic adoption, overcoming challenges, and learning from success stories will be pivotal. The future of finance is undeniably intertwined with AI, promising a landscape of unprecedented opportunities.

Was this article helpful?

Advertisement

Subscribe to get your daily business insights

Advertisement
Continue Reading

Finance

Teacher using 'Lattimore Bucks' to teach personal finance

Published

on

Teacher using 'Lattimore Bucks' to teach personal finance

CHARLOTTE, N.C. — Every Monday, Renaissance West STEAM Academy math teacher Shelby Lattimore starts her class by charging her students for their seats, not with U.S. currency but with “Lattimore Bucks.” It’s a project she started last year as a way to improve attendance.

“It’s not just about having them here,” Lattimore said. “It’s about having them here for the whole day from start to finish, ready to rock and roll. On top of the fact, just to get them accountable for their behavior and taking accountability for certain things in the classroom.”


What You Need To Know

  • Shelby Lattimore started using “Lattimore Bucks” in her classroom to help curb attendance problems
  • Each student has a classroom job, they get paid every week with Lattimore Bucks
  • With their bucks they pay for rent, as well as fines if they misbehave.
  • They also can buy rewards to teach them personal finance lessons

Each student is assigned a job in the classroom, which rotates every two weeks.

“These are their jobs,” Lattimore said. “If they’re underlined, they get paid $10. So those are the harder jobs they have to do every day. And then the ones that are not underlined, like this one, he just has to change my calendar. He just has to change the day on the board, like once in the morning so he doesn’t get paid as much.”

With their salaries, her students pay their rent for their seats. 

Advertisement

“Their rent was inflated as of January, from $5 to $7,” Lattimore said.

And if students misbehave, they’re fined. 

“Like if you purposely lose your pencil, rip your notebook, things of that sort and then of course disrespect,” Lattimore said. “And their fines are a dollar.”

The more Lattimore Bucks they save, the more rewards they can buy. That is, as long as they have enough to pay their rent.

“Let’s say they have $10, but they want to buy lunch with a friend. If I do 10 minus 5, you’re not, you don’t have $7 for your next rent. So they cannot buy anything past their rent that they have to keep in their wallet,” Lattimore said.

Advertisement

While the project may have started to improve effort in the classroom, Lattimore says it’s morphed into a much bigger lesson for her students. 

“Some of their parents, you know, thank me all the time,” Lattimore said. “We talk about all the time in Charlotte, generational poverty is a huge statistic here, especially in the kids and the families that we serve in my school.” 

She’s instilling lessons of personal finance and budgeting into the lessons every day.

“So just starting the mindset of how can I hold onto money? How can I make long-term decisions with my money? It all starts from a very young age in a safe environment before they’re out in the real world,” Lattimore said.  

It’s done in hopes of setting up her students for the future.

Advertisement

“Even my students from last year, they are telling me that they’re saving their money, and they’re budgeting their Christmas money for a pair of sneakers or whatever they want,” Lattimore said. “So they’re holding onto the lesson. So I can only imagine a couple of years from now when they’re adults, how that will affect their family.”

Lattimore says other teachers she knows have started similar programs in their own classrooms. She says the concept can be used at any school for any grade level as a simple way to teach basic finances.

Continue Reading

Trending