Careers

11:02 AM
Justin Grant
Justin Grant
Commentary
Connect Directly
Google+
Twitter
RSS
E-Mail
50%
50%

Coming Barclays Layoffs Point to Fragile Recovery

Although optimism is slowly creeping back to pre-crisis levels on Wall Street, that's apparently not quite the case at Barclays PLC.

Although optimism is slowly creeping back to pre-crisis levels on Wall Street, that's apparently not quite the case at Barclays PLC.

The firm's investment banking arm is planning to lay off about 2.4 percent, or 600 of its global workforce at the end of the week, according to FINS.com , a Wall Street Journal site that focuses on careers.

The cuts are expected to be across the board, impacting a wide range of job functions and seniority levels, FINS.com reported, citing sources familiar with the matter.

From FINS.com:

"The layoffs are a dramatic reversal in strategy. In the year ended September 30, Barclays Capital added 2,000 workers, specifically building out its sales and trading desks. The bank has also been hiring in Canada and building out its wealth-management team in the U.S. The hiring produced results, as Barclays garnered a 25% increase in investment banking revenues in 2010, one of the biggest gains of the year, according to data from Thomson Reuters. However, the firm still only reached No. 8 on a ranking of banks by fees and the company's trading and principal investment operations slumped dramatically.

A pair of UBS analysts released a report early this month saying restructuring is due at Barclays. The Jan. 1 start of Robert E. Diamond Jr. as CEO presents a propitious time to shrink the institution, they argued.

The coming layoffs at Barclays Capital also highlight how fragile the finance industry's recovery is, since the firm is reportedly not the only one considering such drastic measures.

From FINS.com:

"Some other Wall Street giants find themselves in a similar situation. Morgan Stanley, for example, added almost 2,100 workers in the year-ended Sept. 30 and finished the year on top of many league tables. But the business boost wasn't cheap. The firm has frozen all hiring in its i-banking unit and plans to withold bonuses altogether from its subpar employees. Bank of America, meanwhile, has laid off about 400 people in its investment banking and capital-markets division."

As the Senior Editor of Advanced Trading, Justin Grant plays a key role in steering the magazine's coverage of the latest issues affecting the buy-side trading community. Since joining Advanced Trading in 2010, Grant's news analysis has touched on everything from the latest ... View Full Bio
Comment  | 
Print  | 
More Insights
More Commentary
Shared Reporting Services on the Horizon, Genpact Predicts
The financial services industry is starting to adopt shared services, resulting in reasonable impacts to the bottom line. Genpact expects a push for reporting efficiency will come next.
Don't Let the Cloud Rain on Your Operations Strategy Parade
Avoid migrating large applications all at once to minimize risk during a cloud project.
Could Intel Lose Data Center Market Share to ARM Chips?
ARM chips could be an alternative for certain purposes in the datacenter, but many questions have to be answered before they pose a threat to Intel's market dominance.
Cost to Trade: Hey, Banks, Itís Time to Face the Music
Why is calculating the cost to trade so difficult for banks? The answer is as complex as the calculations themselves.
M&A Activity Will Continue to Grow in 2015
Data shows that the M&A market continues to improve, and forecasts indicate deal making will be healthy in 2015.
Register for Wall Street & Technology Newsletters
White Papers
Current Issue
Wall Street & Technology - Elite 8, October 2014
The in-depth profiles of this year's Elite 8 honorees focus on leadership, talent recruitment, big data, analytics, mobile, and more.
Video
Exclusive: Inside the GETCO Execution Services Trading Floor
Exclusive: Inside the GETCO Execution Services Trading Floor
Advanced Trading takes you on an exclusive tour of the New York trading floor of GETCO Execution Services, the solutions arm of GETCO.