Foreshadowing the Great Recession: Banks Cut 160,000 Jobs; More To Come; Not All Layoffs Counted
Link here to Reuters/Yahoo.
Major banks have announced some 160,000 job cuts since early last
year and with more layoffs to come as the industry restructures, many
will leave the shrinking sector for good as redundancies outpace new
hires by roughly two-to-one.
A Reuters analysis of job cuts announced by 29 major
banks showed the layoffs were much bigger in Europe than in Asia or the
United States. That is a particular blow to Britain where the finance
industry makes up roughly 10 percent of the economy.
The tally of nearly 160,000 job cut plans, meanwhile,
is likely to be a conservative estimate as smaller banks and brokers are
also cutting staff or shutting up shop, and bigger banks have not
always disclosed target numbers of layoffs.
The tally also does not include reports of 6,000 job
cuts to come at Commerzbank, for example, which the German group would
not confirm last week.
To me this is foreshadowing the fact that banks have more staff than needed to meet the demand for services and they are restructuring to address that situation. Has nothing to do with an imminent recession.
ReplyDeleteNext time you go to a retail bank branch, look around at the mix of customers to staff. Every bank I have been in recently appears to me (granted non scientific) that the branch has more people(employees) than needed to serve their customers. Sounds like the same with investment banks .
You are correct. It does not matter the reason for the layoffs; I'm just pointing out that unemployment is going to be incredible going forward. Unemployment and significantly less business investment (posted earlier from a Boston Globe story) --> huge recession.
DeleteThe unemployment numbers yesterday -- jobless claims soared -- and although said to be related to Sandy in the headline, turns out that two states most affected -- Ohio, Pennsylvania -- not hit by Sandy.
I fail to see how you reach your conclusion based on the article linked. Bank tellers (retail) are being displaced by technology and a move to all electronic (paperless) banking. Investment banking is m/a and ipo's. Based on the article , these guys are wildly overpaid and loss of their services will not stall investment. Companies that have good busineses with strong demand (especiay needed is more consumer demand) will find ways to expand. I think you are fixated on anecdotal evidence in troubled sectors.
ReplyDeleteI may be, but you might want to see the very first link at this post:
Deletehttp://www.milliondollarwayblog.com/2012/10/doomsday-american-worker.html
Twinkies: not exactly a troubled sector.
Texas Instruments: all technology; not a troubled sector.
NBC Universal: troubled?
Vestas Wind: troubled?
Utah Coal (and, of course, the entire US coal industry): very troubled.
Lockheed Martin: hardly troubled.
And a dozen more high-tech companies listed at the site.
No, I don't think I am fixated at all on anecdotal evidence in troubled sectors. I didn't even mention the most troubled sector: housing.
We may end up in a recession but if we do it won't be due to mismanagement of an entire sector that finally realized they had structured it's workforce incorrectly and had layoffs to deal with the situation. To me this is long term healthy for the sector and the economy. Granted it is painful for those directly affected.
ReplyDeleteSee my previous response.
DeleteAnybody who missed the business investment story in the Boston Globe (posted); the recent news of Japan's downturn (posted); the recession that the EU is now officially in (posted); the soaring unemployment rate (not related to Sandy; posted); the less-than-stellar Chinese growth (not posted); .... is missing my point.