Layoffs on Wall Street Surge in May


Wall Street layoffs surged in May to the highest level seen in at least one year due, in large part, to a major staff reduction at JP Morgan Chase.  However, managers at most investment banks remain cautious about the near-term outlook for business – a factor that has limited firms from aggressively bringing on new staff.

May 2015 Challenger, Gray & Christmas Report

According to the Challenger, Gray & Christmas monthly Job Cuts Report released earlier today, the financial services industry saw planned layoffs spike over 600% from 758 layoffs announced in April to 5,539 layoffs announced in May.  The May 2015 layoff figure represents a 381% increase from the 1,151 layoffs reported May 2014.  One piece of good news in this month’s Job Cuts Report is that over the first five months of 2015, layoffs at financial services firms are 28% lower than the total seen over the same period last year.

New hiring, however, was slightly more constructive in May.  During May, financial services firms announced a modest 325 new jobs were available, following no new jobs in April.  Over the first five months of this year, new hiring on Wall Street has totaled 3,525 jobs – up over 240% from the 1,029 new jobs announced during the same period in 2014.

Wall Street Layoff & Hiring Trends - May 2015
As you can see from the above chart, layoffs have exceeded 5,000 on a monthly basis twice since the beginning of the year – the worst performance in this time series since late 2013 / early 2014.  New hiring, on the other hand, looks to be stuck at anemically low levels reflecting the fact that Wall Street executives remain unwilling to staff up with business conditions remaining so weak.

Wall Street Layoffs

JP Morgan Chase was the one major Wall Street firm which announced a significant round of layoffs in May, saying they plan to cut their workforce by more than 5,000 (2% of the bank’s staff) over the next year.  At least 1,000 of the planned 5,000 layoffs have already been carried out in the past few months.

Chairman and Chief Executive James Dimon explained that the bank plans to rely more on technology, and less on human tellers.  However, this layoff is not expected to dramatically slash hiring in its branch network as the average J.P. Morgan Chase branch would lose one employee over the next two years, mostly through attrition.

J.P. Morgan has trimmed its total head count in 11 of the past 12 quarters to 241,145 employees as of the end of the 1st Qtr.  This is down about 20,000 or 7.7% from the peak in the 1st Qtr of 2012.  However, this drop is modest in comparison to other large banks.  Bank of America Corp has shed 20% of its workforce and Citigroup Inc. has cut 9.1% of its staff over this period.

Impact on Research Industry Hiring

The mixed jobs picture in May doesn’t alter our overall outlook for hiring in the research industry.  Weak mortgage and IPO business at most banks has offset stronger trading revenue.  In addition, the uncertainty surrounding pending regulations in Europe regarding research payments has made most research executives nervous.  Consequently, we think most sell-side investment banks and independent research firms will continue to take a cautious approach toward hiring over the coming months.



About Author

Mike Mayhew is one of the leading experts on the investment research industry. In addition to founding Integrity Research, Mike is on the board of directors of Investorside Research Association, the non-profit trade association for the independent research industry, and a frequent speaker on research industry trends and developments. Mike has over thirty years of research industry experience. Email:

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