Goldmans 'plan huge jobs cull'

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The Independent Online

The City was braced for further jobs turmoil today after it was reported investment bank Goldman Sachs planned to axe 10 per cent of its workforce.

As many as 3,250 jobs worldwide could be affected by such a move. It is not known how many of Goldman's 6,000 employees in the UK - mainly based in London - would be affected.

It is believed the job cuts are a direct result of the current economic slowdown and significantly lower levels of business activity. Goldman declined to comment today.

Last month Goldman Sachs, along with Morgan Stanley, switched to being bank holding companies as investors feared the stand-alone investment bank model may no longer be viable.

The move came amid the financial turmoil that saw the collapse of Lehman Brothers and banks dramatically reduce lending to each other for fear that they would not be repaid.

Goldman had been seen as one of the best performing banks during the credit crisis. Although the company's profits fell 71 per cent in its third quarter to 31 August, this performance was still better than many of its rivals.

The job cuts follow thousands of other redundancies in the City as the slowdown takes its toll on banking institutions.

HSBC, Merrill Lynch and Citigroup have all announced cuts recently.

And the latest UK-wide unemployment figures showed the biggest jobless rise since 1991, with 1.79 million out of work and warnings that unemployment could spiral to three million.

Goldman, which has its headquarters in New York, saw its worldwide workforce reach record levels at the end of the third fiscal quarter. It is now expected to be reduced to nearer 2006 and 2007 levels.