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Banking giant Goldman Sachs, which as recently as November predicted the U.S. would narrowly elude a recession, is poised to cut nearly 10% of its workforce in the next month, citing slowing economic conditions for the pullback.
Heading into the new year, the firm plans to eliminate up to 4,000 jobs, or 8% of its workforce, as part of its cost-saving strategy, Bloomberg reported, citing unnamed sources. Like other industries that have begun tightening their belts, the amount of space the company needs might be called into question as its workforce shrinks.
“There are a variety of factors impacting the business landscape, including tightening monetary conditions that are slowing down economic activity,” Goldman CEO David Solomon said in an end-of-year message to staff. “For our leadership team, the focus is on preparing the firm to weather these headwinds.”
Although the company is expected to bring in $48B in revenue this year, marking its second-best annual total behind only last year, the firm has had expensive ventures, including into consumer banking and new technology expenses.
Goldman has 26 U.S. offices in markets across the country, according to its website. In June, the firm leased 365K SF at One Phipps Plaza in Atlanta. Goldman owns its 2.1M SF headquarters at 200 West St. in New York, according to CommercialCafe.
Goldman Sachs had been one of the more optimistic financial service firms, in November pegging the United States' chances of entering a recession over the ensuing 12 months at 35%.
Earlier this month, Goldman announced that it was raising money for a more than $7B real estate debt fund, which can typically charge higher margins, making a good return on better-quality assets as economic uncertainty persists.
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