Employment: Financial industry lay-offs rising
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BANKING

Employment: Financial industry lay-offs rising

Over 50,000 jobs on the block; Move to fixed compensation added pressure

Lay-offs in the banking industry are back. Over the summer, banks worldwide announced tens of thousands of planned headcount cuts. "The fact that headcount has so far continued growing into 2011 suggests that firms had until now believed that weaker industry conditions would only be temporary. That view has now changed, and firms have very rapidly switched into cutting mode," say Barclays analysts Jeremy Sigee and Kiri Vijayarajah in their August banking note.

Bank of America announced that it would cut 3,500 jobs by the end of this month, while some sources suggest the total amount over the next year could be closer to 10,000. UBS announced in August that it planned to cut 3,500 jobs by the end of 2013 – half of which would come from the investment banking division and half from asset management and wealth management. Swiss rival Credit Suisse said in July that it would axe 2,000 jobs across equities, debt, finance and investment banking.

Goldman Sachs said it was laying off 1,000 employees. Barclays reduced its group headcount in the first half of the year by 1,400 and is expecting a similar cut, or perhaps a slightly higher one, for the second half of 2011.

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