Big Banks Are Quietly Cutting Thousands of Employees | Hacker News Reader

Big Banks Are Quietly Cutting Thousands of Employees

cnbc.com

17 pointsbelter10 comments

I am beginning to think that almost all (big) companies over hired and will start shedding employees because they don't need them. I'm wondering when We will cross the threshold of the number jobs permanently less than the number of people.

This is situation called structural unemployment but structural unemployment is defined as a mismatch between the skills of the workers and the jobs. I'm interested in the case where even if everybody had the right skills, there are fewer jobs than people.

Isn’t there buffer though? As folks work less they do hobbies and leasure more, creating greater demand for related goods and services?

I think this totally makes sense and is reflected in the US's historically high unemployment rate of check's notes, 3.8%.

It's also related to interest rates. There's always ideas for businesses and start-ups, but if money is too tight they won't be created and people won't be hired.

In the case of wide-spread unemployment there would hopefully be stimulus packages or lowered interest rates before mass protests.

Why is this a surprise? Most banks are overstaffed in the wrong areas and have too big a real estate footprint. It's not just a BOA or Wells Fargo issue, I see it in every local and regional bank in my area. All of them built up in high income zip codes just as millions of people shifted to online and mobile banking, and now they have nearly deserted lobbies and teller counters. Mortgage operations have been centralized, and suffer from boom/bust cycles tied to interest rates and supply fluctuations.

The reason why you see them built up in the high income zip codes is because branches are almost completely out of the business of regular teller operations of years ago which as you correctly point out have moved largely online. Instead branches exist to move high margin services and wealth management product to high income customers.

That isn’t to say the big banks don’t have a real estate problem - they do but it’s more the back office than it is branches.

I’d love to visit an overstaffed bank. Each time I need to visit a branch I’m waiting for the single teller while the manager tries to sell me a credit card or mortgage.

With interest rates where they are, loan demand has to be abysmal.

If there's one word I don't want to see in any article in 2024 it's "Quiet".

They did this 25 years ago when I worked on Wall St. Nothing new.

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