Why 100,000 Bankers Lost Their Jobs in 2015

Keiser-Bankers-Thumbnail-Anti-MediaBy Carey Wedler

Nearly 100,000 Western bank employees lost their jobs in 2015, according to an analysis by the Financial Times. Those job losses comprised over 10% of the workforce among 11 large American and European banks, continuing the overall trend that followed the infamous financial crash of 2008. Cuts are expected to continue in years to come, as alternative technology revolutionizes the financial sector.

Business Insider noted some of the banking giants that eliminated positions this year: “They include HSBC, Morgan Stanley, Standard Chartered, Royal Bank of Scotland, and Credit Suisse. Barclays and BNP Paribas are expected to add to cuts early in the new year.”

FT reported on various reasons for the reduction in employees:

Banks have found that they have been carrying too many staff, as they suffer falls in revenues from a combination of tougher post-crisis regulation, ultra-low interest rates and sluggish activity among clients.

The growth of financial start-ups and apps (known in the banking industry as fintech) is confounding the job hemorrhage. As Jon Peace, a banking analyst at London-based Nomura, told the Times:

Digital transformation could also be a driver of further headcount reduction longer term, with retail banks cutting branches in favour of online services and investment banks cutting back offices in favour of online technologies such as blockchain.

As Business Insider has summarized, blockchain is “the software that underpins bitcoin and uses complex cryptography to allow transactions between strangers to take place without the need for a trusted intermediary such as a bank or clearing house.” Gizmodo explains the blockchain “is designed to make transactions safe and reliable even if the people doing them don’t trust each other,” noting enthusiasts believe it has “genuine potential to tip power dynamics in banking, politics, the internet, and everywhere authorities, well, authorize things.”

Last month, former Barclay’s CEO Antony Jenkins commented on the power of new technologies:

We will see massive pressure on incumbent banks, which will struggle to implement new technologies at the same pace as their new rivals. That will make it increasingly challenging for them to deliver the returns and profitability that their shareholders demand.

Ultimately, those forces will compel large banks to significantly automate their business. I predict that the number of branches and people employed in the financial services sector may decline by as much as 50% over the next 10 years, and even in a less harsh scenario I expect a decline of at least 20%.

A British survey of senior bankers last month found 27% view tech firms as the greatest threat to their business. In light of these concerns, banks are consequently attempting to improve their technology. Apple Pay is a prime example of such efforts. Further, this year, bankers invested $50 million in a blockchain-oriented company, acknowledging Bitcoin could “shape the future of finance.”

Hoarding these items is better than having money in the bank (Ad)

In spite of such undertakings to remain relevant in the 21st century, the Financial Times analysis shows banks are continuing to shed jobs. Financial Times noted the losses reflect an ongoing trend, as U.S. banks and insurers cut more than 400,000 jobs in the first five years of the financial crisis. In Europe, the 30 largest banks cut 80,000 jobs between 2008 and 2014.

As Jenkins said last month: “In my view only a few [incumbent banks] will have the courage and decisiveness to win in this new field.”

This article (Why 100,000 Bankers Lost Their Jobs in 2015) is free and open source. You have permission to republish this article under a Creative Commons license with attribution to Carey Wedler and theAntiMedia.org. Anti-Media Radio airs weeknights at 11pm Eastern/8pm Pacific. If you spot a typo, email [email protected].

Activist Post Daily Newsletter

Subscription is FREE and CONFIDENTIAL
Free Report: How To Survive The Job Automation Apocalypse with subscription

3 Comments on "Why 100,000 Bankers Lost Their Jobs in 2015"

  1. yEshUA ImmAnUEl * ben-'Adam | December 16, 2015 at 5:57 am | Reply

    “All beings tremble before violence.
    All fear death.
    All love life.
    See yourself in others.
    Then whom can you hurt?
    What harm can you do?
    He who seeks happiness
    By hurting those who seek happiness
    Will never find happiness.
    For your brother and sister are like you.
    They want to be happy.
    Never harm them.
    And when you leave this life
    You too will find happiness.”

  2. This is not really all that unusual as new technologies always result in changes to the workforce. Not really a survival issue other then those that got let go. And they will find new employment.

    I found new employment every time I lost a job. I finally settled on self-employment and didn’t suffer any more lay offs or being fired. And it brought a freedom that can’t be explained to someone that has punched a time clock all their life.

    Self employment is actually harder then working for others, but it’s more rewarding at the same time. You alone control your income level and every new skill results in almost instant income boost, you don’t have to hope a boss is willing to pay you more when you do more. You do extra things for a customer and it results in more billable income. It generally doesn’t go that way when you work for others.

Leave a comment

Your email address will not be published.