Survey reveals further financial job losses

| June 30, 2008 | 0 Comments
Survey reveals further financial job losses

A joint survey, conducted by the Confederation of British Industry (CBI) and PriceWaterhouseCoopers (PWC) has established that a further 10,000 City jobs will go in the financial services sector over the next 3 months, due to the ongoing credit crunch.

In the previous quarter, between 10,000 and 11,000 jobs were lost as a result of the credit crunch.

Profitability in the sector declined at the fastest pace on record, while business volumes fell at the fastest rate since the early 1990s, according to the survey.

Companies are now battling to reduce costs by proposing to trim back on training and marketing for the first time in a number of years.

Commenting on the findings, Ian McCafferty, the CBI’s chief economic adviser, said the problems of the financial industry will filter throughout the wider economy and will drag economic growth down this year and next year.

John Hitchens of PWC added that banks have made their gloomiest profitability predictions for 14 years and confidence in the industry has declined the most sharply for a decade.

Just last week, Wall Street giants, Citigroup and Goldman Sachs, announced staff cuts.

Citigroup, which is America’s largest bank, is believed to be axing up to 6,500 investment banking jobs.

Just 2 months ago, Citigroup said that 9,000 jobs would go in addition to the 21,000 laid off in the last 12 months.

Goldman Sachs, which has emerged from the credit crunch relatively unscathed, is also eliminating 10% of its workforce in the M&A and corporate fundraising divisions this year.

Other investment banks to reveal job cuts include Swiss investment bank, Credit Suisse, who plans to axe 75 jobs in in its investment bank and support services division in the UK.

UBS, which is Switzerland’s largest bank, has reduced its workforce by almost 7% after being hit by heavy losses. It is one of the biggest victims of the credit crunch.

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