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Lloyd Blankfein’s swingeing cost cuts at Goldman Sachs really hit bankers where it hurts in March: their phones. No longer will their employer simply pick up the tab for their smartphone usage – Goldman bankers now face the indignity of having to itemise their monthly bills and (good grief!) claim their money back.
For a bank that grew net revenue by 25% to $3.6 billion in the final three months of 2016 (and by 78% in FICC alone), this might seem a little churlish, but rival JPMorgan stopped paying its employees’ phone bills in 2015, so Goldman is behind the curve here.
From March 1, GS will reimburse international data roaming and WiFi only as long as employees itemise their monthly bills – and it won’t cover WiFi while on holiday at all. It will pay $10 for data charges in the US, £10 in the UK, €10 in Germany and HK$100 in Hong Kong.
Goldman cut its expenses bill by $900 million in 2016, but this attack on phone costs shows that the belt-tightening hasn’t finished yet. Given how much many Goldman bankers earn, this probably isn’t too heavy a burden – although given how much time bankers spend glued to their smartphones it might prove irksome. The indignity of having to itemise usage is where the real pain is.
The reimbursement levels mean that for every $10 a Goldmanite in New York can claim, their peers in London are getting $12.23, in Frankfurt $10.67 and in Hong Kong $12.88. That might be enough to stoke sufficient dissent in the ranks of the US firm that they (perish the thought) limit themselves to using their company-issue Blackberrys.
Or they might take the well-trodden route from Goldman Sachs to the Trump administration, where the CIA and/or ex-president Obama will probably monitor and itemise their mobile phone activity for them.