Goldman Sachs' banking job cuts cancelled. Maybe everyone is safe?
If Goldman Sachs is doing it, maybe everyone else will too? The Financial Times is reporting today that Goldman Sachs will not be making the second round of job cuts it was considering for September, because its investment banking revenues have recovered 'better than expected.'
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Goldman's forbearance follows a cut of 700 people between March and June 2025, amounting to a 2% reduction in its headcount. That cut was initially expected to affect the 3-5% of staff Goldman removes in a normal year. If Goldman ends 2025 with only 700 people losing their jobs, it will be a fine thing.
It may also mean that other banks decide not to cut heads in the third quarter too. Deutsche Bank's M&A bankers didn't have a great second quarter despite all the bank's recent hiring, but maybe DB will be patient if Goldman is too.
Goldman, however, has more reason to retain its bankers than others. As the chart below shows, its M&A revenues rose by 71% year-on-year in the second quarter. At Deutsche Bank, M&A revenues rose by 2% in the same period.
After their big quarter, Goldman's bankers will also have pointed to their turgid pipelines. Speaking earlier this month, CEO David Solomon said "the level of dialogue" was up "significantly" and that "a period of a higher level of activity" had been entered. Juniors at the firm have been complaining again of overwork and understaffing.
If banking jobs are spared in the third quarter, it may be that Goldman's banking team ends this year with almost no one being removed. The 700 cuts that took place in Q2 were thought to be directed at engineers, particularly those at vice president (VP) level who were working from home.
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