The primary concern is the people who have lost jobs, and for some, careers and dreams. Some of them are probably reading HN today.
But for the economy, it could be a good thing: Talent moving from moribund, unambitious, lower-return businesses to dynamic, often new ones that are hiring and expanding for an optimistic future. (I say unambitous because they are, at least in this situation, cutting costs and talent rather than investing in and taking risks for a bold future.)
Unemployment is low, the economy is growing. Usually layoffs, etc. happen widely when the economy is slow and unemployment high, and then the newly unemployed have a hard time finding new jobs.
If it's going to happen, in some senses now may be the perfect time for the individuals and the economy.
Not gonna happen.
If other companies say "we are firing people", other companies would do the same (unless you are apple). We've seen it before with hiring. Hire not because we need, but because everyone is hiring.
How does this reconcile with "enshitification" as popular platforms with millions of users try to become profitable by removing features and paywalling access? My understanding was that the zero-interest era was the time of optimism and building new cool things.
And as always I assume most of the senior leadership will go unscathed, and might even collect a bigger bonus due to "successfully reducing the cost structure".
Well you’re not correct there. The first round was in November and 300 managing directors, representing 10% of the employees at that level were let go.
The cuts expected next week are for middle management at the next two levels down. Subsequent to that there is an expectation of one more round. Additionally Citi is shuttering the muni business.
I think most people expect that after those changes attrition should get to the headcount target by 2026.
Agreed that that that that qualifier or similar(over the next two years) would have made sense. However that's 200K began in earnest two month ago already:
>The bank began layoffs in November. At the time, employees speculated Citi would ultimately cut 10% of its workforce.
>They were spot on, executives confirmed Friday.
I can't imagine the morale working in an environment where layoffs are slated to continue for the next two years. Citibank had already been a toilet of a bank for some time. I'm guessing a multi-year layoff plan will do little to alter that.
My admittedly naive opinion is that the current generation of CEOs have decided to define a company's growth by headcount rather than revenue or profit.
They don't put enough consideration into whether they need more people. They adopt the Project Manager mindset of thinking 9 women can produce a baby in 1 month if they work together.
Just because 20 engineers produced a product that created a product that produces $100M ARR doesn't mean that 100 engineers will produce a product that produces $500M ARR.
"Overhired" is not always the best way to describe "hired with intentions to do things while capital was cheap". I saw a bunch of startups and larger that really did intend to build things. When hard times hit, some shut down. Some cancelled any lofty project that wasn't already committing to their bottom line.
So the solution is, "never hire headcount to work on a project that might not be financially viable in a recession"? Help me see another solution here.
Because they seem to think that saving money offers more value to shareholders than creating additional value. I'm not sure they know how to offer new value.
"Citigroup CEO Jane Fraser announced a sweeping overhaul of the third-largest U.S. bank by assets in September. The company has been left behind by peers since the 2008 financial crisis as Fraser's predecessors couldn't get a handle on expenses and is the lowest valued among the six biggest U.S. banks.
In November, CNBC reported that managers and consultants involved in the effort - known internally by the code name "Project Bora Bora" - discussed job cuts of 10% in several major businesses.
The company has since executed several waves of layoffs, beginning with the top layers of the bank, with another round of cuts set for Jan. 22, according to a person familiar with the matter. A Citigroup spokeswoman declined to comment."
Interesting that in beginning of January a lot of the job cuts are being announced, I'm sure decisions were made previous months. Is it because of the time to recover for potential backslash in the quartarely reports or any other reason?
Actually their favourite time to cull the workers is last quarter and ensure that you’re out before bonuses are announced and paid in January. That’s always November and December. That they’re doing this now is unusual for them.
Holidays cam play a role. Despite how much I say it shouldnt impact my decision making, it's tough to let someone go ahead of Thanksgiving and Christmas.
Citibank told their employees to work from home in December and common understanding was that it would make the upcoming layoffs easier (quick Zoom with HR and mailing the hardware back to the office is all it takes).
In addition their Q4 results came in REALLY bad ($1.8b loss) so they're using it to justify the cuts to appease the investors.
Well, looks like this one is old-school, but 7% is the new 10%.
Anyway, most recent layoffs look quite stupid to me (even though I can't make my mind on this one), but if you are doing a layoff, rank and yank is about as good a format as you can get.
I am great at dealing with people. I deal with customers so that engineers don't have to. I have people skills! what the hell is wrong with you people?!
I assume Citigroup is planning for the output of their workforce to decrease with all these layoff and not assume the other employees to pick up the slack. Right?
What's going on with all these job cuts all concentrated now? The market is expecting the Fed to start cutting interest rates[0] in March and that has been bullish for the latter half of last year in the stock market. So why are so many companies cutting people? Are the March rate cuts too little too late or do they see that some damage has already been done and they're front running that? Or is it that layoffs is the only way they see to maintain their growth expectations set by wall street and thus it's a financial engineering move?
This is everyone's last chance to trim their roles before the rate cuts. Once the rate cuts occur, the bull market will return, and companies doing layoffs (sending the message they are not experiencing growth) will be punished by the market.
Expectation of a bull market. Right now companies arent being penalized for layoffs because there's some uneasiness about the impact of the feds actions. A lot of people expected a recession from pushing interest rates this high, but it hasn't happened. Once it's clear that there will be no recession from the fed's actions (ie: when rates drop), CEOs will be fully responsible for their company's poor performance in the eyes of the market.
It's January. This is when annual budgets are set. Layoffs are a natural consequence of "the budget for this year is smaller than last year". Hell, even if the budget is the same size, it'll result in layoffs if anyone got promoted, anyone got cost-of-living raises, etc. A 4% cost-of-living adjustment for everyone results in a ~4% layoff if annual budgets remain constant.
Also, the market is predicting rate cuts in March. There is always the chance of the market being wrong, and several prominent institutions (notably Goldman Sachs and JP Morgan Chase) have said they believe this is overly optimistic and it's unclear if we're even done with rate hikes, let alone rate cuts. The Fed statements themselves do not come anywhere close to what the market is predicting - the dot plot (which has trended overoptimistic for the last 3 years) predicts 3 rate cuts, while the market predicts 7.
The Fed's suggestion of 3 rate cuts down to 4.5% are still quite high compared to the period of a decade of essentially ZIRP that preceded it.
The futures market expectation of 6 rate cuts is likely equivalent to a bet that there will be a recession by the year's end.
Either way you have "end-of-cheap-money" conditions or "recession" conditions and so the ZIRP-fueled hiring boom needs to get reversed.
Honestly I don't think there's much of a distinction and that the end-of-cheap-money leads to these kinds of layoffs which will eventually trigger a recession, combined with vulnerable sectors of the economy (commercial real estate, private equity) popping.
For all the fanfare that we've managed to hit a soft landing, the historically based fed-cycle recession predictions were always that a recession typically comes 6-12 months after the Fed STOPS hiking rates -- which means this July.
Also, effect of rising interest rates takes time to propagate. When mortgage rates skyrocket, mortgage originators can still go on for a few months even though they're not making any sales, as nobody's buying real estate. After a few months it becomes clear that sellers are not willing to decrease their prices and Fed is not going to cut rates any time soon, the game's over and they have to cut staff or even go out of business.
Startups can continue to operate for a few months burning through their reserves even though nobody's investing in them until they... can't.
When the price of bonds that banks have on their assets plunges due to increase in interest rates (they are "marked to market"). Depending on their regulatory requirements it can take a quarter or two. As a result the ratio of the assets of the banks in relation to their liabilities decreases. That's what caused SV bank to collapse (they had less money than they had liabilities and had to fold due to the bank run). In the case of citibank they had to put $1.7 bln into the government deposit insurance fund, which is likely related to the same phenomenon.
Interestingly enough, they also reported that a big part of their one-time expenses ($3.8 bln total) included reorganization expenses, e.g. all the severance they had to pay to the people they laid off in 2023 and other costs related to cutting those people.
Even more interesting, they expect the expense related to cutting 20,000 people to be between $700,000 and $1 billion.
All things considered, Citibank doesn't strike me as a particularly well run organization, and low-level employees are paying the price. As per usual.
> What's going on with all these job cuts all concentrated now?
This is how I am imagine it went down.
> Excuse me, sir. The council is worried about the economy heating up. They wondered if it'd be possible to fire 500000. Maybe from one of the smaller companies where no one would notice, like one of the cab companies.
At this point, we are in full bandwagon/meme territory, aside from the few companies that actually do need to fix their cashflow.
Now that the stock market will probably immediately reward you if you just recite the mantra "we overhired, COVID, etc", it's just the latest way to juice your stock price. There's enough padding when you have thousands of employees that your products won't suffer too much, and it gives you an excuse to reorg and perhaps find more efficiencies in the process. In theory, I can see the draw of "a reset will make us faster".
Of course, new efficiencies aren't guaranteed and the company's output may stay the same or shrink in the future, but at least the shareholders got more money.
Layoffs in December can potentially be bad press, so what we're seeing now is the execution of the 2023 plan to Big Reset before the market judges this type of move as a bad look again. Everyone else is juicing their stock prices this way, why shouldn't we?
1) Citi has been talking about these cuts for three months. There’s little new here other than the CEO specifying the target head count.
2) There is no intent to rehire. Whole business lines are being shuttered.
3) Yes, of course there is a huge management problem. They fired 300 managing directors in November.
Since 2000 Citi stock is down more than 90%. JPMC and BofA generate an order of magnitude more revenue per employee than Citi. Jane Fraser is just the latest in a long series of executives seemingly unable to tame the beast.
Noone wants to cut during the holidays. I'm guessing most of these were decided months ago. You're just seeing them happen as people get back into the office.
For one, this is not an announcement of 20K layoffs. It's an announcement of planned reduction in headcount as of 2026. Also, it's global workforce, not US. Also, go look at the BLS JOLTS data. Job separations happen by the millions every month even when we see net job growth. Seeing headlines about job losses at a particular company are only news as it pertains to that company. It doesn't imply a national or global trend.
I wonder if its people noticing that maybe they over hired and now is a better time than ever to fix that. I've seen lots of people use Twitter as a gut-check case study.
Citi has been pretty dysfunctional, and job cuts were coming, for a long time. I know there have been a lot of tech layoffs announced lately and maybe there is something behind those but I wouldn't assume this announcement has the same cause.
Fraser (the CEO) has been talking a big game for months about taking drastic action to turn Citi around. Sooner or later she had to actually do something or else her own position would start to look very vulnerable.
I don't recall something like it ever happening, except perhaps when there was an economic event (like in 2008). It's either a big coincidence, or there is a common outside cause, or it's coordinated.
I think this is a “skate where the puck is going” situation. The fed sees things trending toward recession before it arrives and starts cutting, but the recession happens before the rate cuts have any effects on employment.
The "dual mandate" was established by the Federal Reserve Reform Act of 1977, whereas the data shows this phenomenon goes back over 20 years earlier. How then could the dual mandate be the cause of the effect?
They had an informal dual mandate to maximize employment and minimize inflation before then, but the purpose of the Federal Reserve as created was to preserve financial stability, avoid financial panics, and maximize employment. In other words, they had half of the dual mandate, the half that involved injecting money when times were bad to stabilize the system. The government codified the inflation mandate in response to the 1970s inflation.
The phenomena of dropping rates when a recession is impending is congruent with the "maximize employment" portion of their mandate, which predated 1977. Indeed, their failure to do this in 1929-1930 led to the Great Depression. Ben Bernanke's pre-Fed-chair academic career was devoted to studying that.
Microsoft and Google are pretty similar IMO, since both have: a browser, a search engine, an operating system, have or have tried to have a phone, both do some amount of hardware, and both also have cloud platform offerings.
People show up for their salary, they work hard for their bonus. The core part of the revenue is taken for granted as they focus on developing new parts, specifically the ads part. It allows for an up-and-coming exec to say "I made X for Microsoft, you should pay me Y% of X". So even though it would only account for a small % of total revenue it would dominate the thinking. It's how ideas such as ad supported Windows happen despite the long term deterius effect that would have on the core business.
They are all financial institutions of comparable size and using similar business models.
The fact that JP Morgan Chase reported Q4 profit at $9.3 bln on the highest annual revenue for any bank EVER, and Bank of America reported Q4 profit at $3.1bln, while Citibank reported net LOSS of $1.8bln, should tell you everything you need to know about how well these organization are managed.
I never got why people choose citi. They don’t offer best lending rates, they don’t have a vast ATM network, their credit card benefits are worse than chase/amex, etc. seems they aren’t really amazing at any particular segment but meh in all.
BoA has this, if you have at least $100k - a 2.625% cash back card, and with Merrill also has competitive HYSA (last I checked, 0.5% higher than Citi). BoA can be great if you have money, but sucks if you don't.
What do you mean have at least $100K? Like in one of their savings accounts? You can get 5% APY right now from Wealthfront in their savings, so you'd have to forgo a lot of interest to get that extra 0.625% over Citi's credit card.
It's 100k in combined assets at BofA / ML, so if you have 100k in a brokerage account (or an IRA or a HSA or ...) you're eligible. It's not restricted to the super low yield savings accounts.
Right as others have mentioned, it's not $100k in savings, it's $100k total across their stuff.
But even if it was $100k savings, you can get ~5% APY at BoA high yield savings through Merrill anyways. I don't recommend that since Fidelity works better for that type of account, but you could do it.
Yup and their CMA is better than the big 4 banks offerings. Get HYSA equivalent rates but just use it like normal checking, not having to shuffle stuff around like with Citi or BoA
Fidelity isn't a bank, but they sure act a lot like a bank with the CMA account. Arguably enough like a bank that it will work as a bank for most people.
Other brokerages do the same sorts of things, Fidelity isn't alone in this. Schwab went a different way and decided to just buy a bank. Instead of like the BOA/Chase versions, where they bought a brokerage.
I like their Custom Cash card (5% back on your top spending category each cycle) cause it can fill in the gaps left by other cards. Their website and their app are both absolute garbage though.
Well, there is IBKR, if you can get away with a brokerage. They don't offer all banking services, and they definitely are not a bank, but in some cases they can act enough like one that it will work out for you.
All three feature an investment bank, a commercial bank and an asset manager. There are a number of smaller operations which have all three but none at the scale of those three. Wells is much smaller, and HSBC isn’t a US bank. Goldman and Morgan Stanley don’t really have a commercial banks and neither do the mega sized asset managers like Blackrock.
So the thing is Citi isn’t really a bad commercial bank and is really useful for corporate treasury services if you’re a large multinational company. Their international footprint is huge and fit a lot of use cases it’s either them or HSBC.
The problem is the IB and AM are ‘meh’ and hugely inefficient. It’s not like they do such a terrible job from a customer perspective. From an investor perspective it just costs so much to do it.
The gap between JPM and Citi is incredible. Part of JPM's success is that it has basically been deemed "America's Bank" by the government, but the mismanagement at Citi is tangible too.
I worked at JPM in investment banking. At least on the IBank side, it was an incredibly well run company. I’m not gonna say there’s no bureaucracy there, but for a company with 200k+ employees it ran very efficiently. And they have always been relatively conservative, not taking on the riskiest bets that some of their peers did, which puts them into a very strong position to take advantage of downturns.
They generally don't pay terribly well for non-revenue generating roles, for a broad definition of "non-revenue generating". I have had rounds of interviews with them over the years where they put me through a bunch of rounds, feel me out, and realize that actually.. they can't really afford me.
I know people who take a job there and JPM nickel & dimes you on the way in, lies about target bonus not being prorated first year, and then also gives 0 raise first year. Cute stuff like "forgetting" to pay starting bonuses for months, etc.
I've heard YoY raises that are some of the worst in the industry. To the point that leaving for a competitor is an easy 50%-100% increase in TC because of 5-10 years of surpassed raises.
Another example, in 2020 when COVID hit they did some wide ranging bonus cuts to offset increases in loan reserves for expected credit losses during the pandemic. As all the stimulus kicked in and the economy started to rip, the credit losses didn't come to pass, so they subsequently paid out a fraction of the money they withheld earlier.
I haven't worked at JPM, but I have at a few of its competitors.
As a technology professional, I think what you describe is par for course at all the banks, and more broadly speaking, pretty much all "non tech" companies in general where tech is considered an unrespected cost center.
Tech compensation is bimodal. You have the top FAANG tier and maybe some companies one tier down where software engineers can make as much or more than medical doctors.
Then you have a sharp drop off a cliff consisting of everyone else - where a senior or staff SWE equivalent with decades of experience can expect to retire in their 60s making about as much as a upper junior FAANG engineer.
I was shocked last year when I heard my intern with zero years of experience got his offer...for about double my compensation at my last bank SWE job.
Halve/quarter your downsides, double your upsides, and you get a more accurate reflection for the Consumer/Small Business side of the house. IB/Commercial have a higher starting point but I am not familiar with the dynamics there. IT/Corporate is on par with Consumer/Small Business.
That said, perceived poor performers really don't get paid well or get bonuses, and that's usually the only clear signal you get.
Oh I wasn't talking down about JPM. I actually worked there for a few in the Private Banking space (as a Software Engineer). Great bank, but they also have has the wind at their back in certain situations (being gifted First Republic in the latest regional banking crisis. FR just had a liquidity crisis. Functionally it was fine. JPM got a steal).
Citi on the other hand hasn't had those options/gifts... largely because of prior mismanagement. I think they're only up 10% in the last 10 years or something crazy like that.
I never had an account anywhere else but Chase (run through JPM) is pretty good, independent of branding.
I have no affiliation with them but at the branch I goto there's always a free ATM inside for quick things, they make it easy to schedule meetings for more complex tasks and the bankers who have their own cubicle tend to be knowledgeable (I've encountered a couple of them over the years).
It's super easy to reach them too, and this is with a basic checking account only. Their checking account is free with no penalties as long as you direct deposit $500 / month OR keep $1,500 in there, for most folks on this site the first option means you only need to keep the bare minimum in there to pay your bills.
I don't care about the lack of interest. Most trading platforms will give you 4%+ which IMO has a nice advantage in that you can stick idle cash in there (untraded) and collect risk free interest and you can quickly transfer it back to your bank account if you need it. It's a reasonable solution for an emergency fund, but it also doubles as a way to instantly put money into the market if an opportunity strikes.
In 2008 banks made behind closed doors deals with the government and some won and some were not invited (Lehman brothers, etc). We are still seeing the effects of that.
16 years ago I told them that making me whole wasn't enough - since they called me a liar in writing they needed to provide an apology in writing. And I wouldn't do business with them until that happened. Still waiting, and still not doing business with them.
Don’t know if you are actively avoiding Citi, but this tone rings a bell.
I have been boycotting PNC bank since 2006. They stole over $700 from me. They gave me $300 back to settle. I refuse to do business with them. I went to a Pirates game, saw it was PNC Park and noped out of there.
Their market cap has since doubled. Fucking over the little person is OK in our society.
I am not trying to sound flippant, but layoffs happen, and especially at companies that are not doing well (and Citigroup is not managing money well) they are normal.
Then, those working at Citigroup are likely to get some form of severance. While I do not know the exact composition of the layoffs I suspect that many of those are well paid and have comfortable cushion. Furthermore, US economy is still chugging along and the unemployment is low by historical standards, so a significant portion of those laid off will likely find another job. They can also downsize and/or move to an area with lower cost of living.
None of this is pleasant, but it is not the end of the world. My 2c.
Unemployment is historically low, but costs are historically high. In 2008 we saw that the state change from good to bad can happen rapidly and contagiously between industries.
> They can also downsize and/or move to an area with lower cost of living.
No, not really. There are simply no housing units available in the US to do that. All new housing is huge 2000sq/ft +. In addition housing prices are just off the charts for small houses. Your low cost of living places (I have family that lives in places like that) still want $250,000+ for a house that was around or under $100,000 less than a decade ago.
I did not claim that being laid off for those Citi employees would go unnoticed. Their standard of living would drop, but they would not have to live in a tent. There are many towns with low cost of housing. If those are too expensive to buy, one can rent (and probably should anyway, just to figure out the new area). The ratio of median house price to median household income today is a little higher than, say, the average over the last 50 years, but it is not 5 times higher.
There is indeed plenty of housing scattered around the flyover counties. For sure, it is less pleasant than in a rich suburban town. Those small towns do not have walkable downtowns or many cafes and eating out means a basic diner (they do not have good restaurants and entertainment precisely because affluent families moved to metros). You are very unlikely to resell it later for a massive profit. But the basics (water, sewer, electricity, groceries) are there and one can certainly live there if laid off and not envisioning good prospects for the next few years. My 2c.
As I wrote, Cleveland is just one example. There are literally thousands of other cities around the country where housing is affordable and home ownership rates are very high. Broaden your horizons.
Not any good ones. I'm astonished at how prices have increased.
People don't need to speculate, or engage in some kind of weighing of Cleveland as a place someone might want to live. Just bring up Cleveland in realtor.com and look at the very few, very low quality house options under 100k. And then consider that most people are going to be living in a suburb that's a lot more expensive anyway.
That's right, there are many job opportunities in Cleveland. The current unemployment rate there is only 3.7%. Anyone who actually wants to work can find a job.
You really missed the point. Some commenters have falsely claimed that there are no jobs available in lower cost of living areas, which we can see is obviously wrong based on the unemployment rate. The fact that San Francisco has a slightly lower unemployment rate doesn't invalidate that point. Compared to SF, Cleveland has much better housing affordability as measured by absolute price, median price to income ratio, home ownership rate, or any other reasonable metric. And there's nothing special about Cleveland; many other cities have similar or better affordability.
I didn’t miss any point because you’re the one who is creating false equivalencies between all US cities on the basis of unemployment rates.
That there are jobs doesn’t mean that there are jobs that align with everyone’s work experiences, familial ties, or various other obligations. If I get laid off in the bay as an ML engineer and have an elderly parent who lives there that I need to take care of, that there are jobs at Sherman Williams in Cleveland isn’t very useful to me. Similarly, if I’m mid-career and pursue work in LCOL area that cuts my pay in half relative to a larger city, that could derail my lifetime earnings and ability to retire.
Reality is more complicated than the simplistic narratives people use to victim blame or reinforce their just-world fantasies.
There’s a chance to move outside London but finding work is harder, on top of that rent is quite high in any commute areas.
I don’t see how this whole housing situation is sustainable. A 1 bedroom house in Peckham, Hackney, ex council going for 400k at 10pc deposit and current rates that’s almost 2k monthly payments for 25 years for a leasehold. Insane!
Agree with everything, but the last point. Fuck work ethic! Take as much as you can by outputting as little as possible to keep you out of trouble. That's how it's done in this age. There is no such thing as loyalty. Employers will screw you at every opportunity. If you're smart, you'll do the same in return. This is how I've operated in FAANG for the last couple of years and I have no regrets. When I'm inevitably laid off, at least I won't have wasted years of my life pouring "work ethic" into this company that barely recognizes my existence let alone treat me with respect.
i think by "positive work ethic" they mean delivery what you were hired to do. In other words, just holding up your end of the bargain. It doesn't have anything to do with loyalty.
This announcement is not layoffs. Citigroup is saying they expect headcount to be reduced by 20K globally by 2026. That may include layoffs, but will also likely be attrition. It's also not confined to the US labor force.
Take a mortgage. You get severance. Then if you fail to make payments it’ll take 3-6 months before foreclosure starts. Most can get a job within that time frame.
In the US this will wreck your credit rating. Yes, you'll survive and won't lose your house. But your borrowing costs will increase significantly if you need a new home, renovation, car, etc.
I hope that's the case where in the location where you are typing from. Unfortunately, it's not the case in places where I have family and friends. Some examples are in cities in Portugal, England, Spain, Germany, etc. In fact, in the past couple of days, I have found to have unrelated people I know about who are desperately looking for a place, separate cases but similar stories in London and Lisbon.
The laid-off email job corporate worker isn't going to take a job for $15/hr at the Flying J unclogging toilets. You can't use the total national average unemployment rate, which has issues of its own, to say the economy is healthy. In the same way, the stock market indices aren't helpful either beyond catastrophic values.
I don't claim that it can be used to say the economy is healthy. I take issue with OP's claim that large layoffs necessarily imply recession. Unless you know that the laid off workers aren't rehired by a competitor, you don't know if the layoff isn't just an outcome of competition. The national unemployment rate is a proxy for it. At least at the first order, if a large number of people are being laid off (and this isn't the first layoff in the sector, Wells Fargo has cut over 40k jobs from their peak) then so far they are being rehired. And I agree with you, desk workers aren't going to take a $15/hr job at the Flying J, which is why I believe they were likely to be hired either by competition or at least in occupations consistent with their skill set and aspirations, else we'd see them show up in unemployment stats. Check sector stats too - very low for finance https://fred.stlouisfed.org/series/LNU04032216#
Fun fact. If I'm laid off from my corporate job and after weeks of searching start driving for Uber or delivering pizzas, I am considered employed in the U3 (the unemployment rate most often reported). I would be excluded in U5 rate (they are referred to as "marginally employed") which is about 1% higher.
Not to nitpick, but I wonder if we can better define "acceptable." For a good layoff outcome, I'd expect the employee to find a new gig within a few months, that's +/- X% of their previous comp. Open question: has anyone seen this data?
A healthy economy shouldn't go straight up, and neither should healthy companies. Adjusting the workforce is a normal course of business. The big media news early in the week started with Google having a lay off which eventually turned out to be ~1k people. It sucks for those people, but is < 1% of the workforce. It's not even something that should have made big news, but everyone is looking for anything to fit a recession narrative right now.
You are really cherry picking to bring your point across. Google was not the only layoffs this week and last year we saw a dramatic increase in number of layoffs in tech from prior years. It is still hard to predict how this trend will continue but healthy is not the word I would describe things at the moment.
What was probably unhealthy was the insane amount of hiring that happened. Even with last year's cuts we're probably still above 'normal' company headcount growth trends.
There is no recession, enterprises are struggling to obtain profits from zero interest rate macro that is unattainable in the current macro. Unemployment will remain low due to structural demographics (10k Boomers retiring per day, 3.65M/year, 1.8M people over the age of 55 die every year, ~1/2 of which are in the labor participation rate). A healthy economy creates ~1-3M jobs/year.
So there will be churn as long as the labor arrangement in the US continues to be tenuous and management struggles to achieve shareholder demands. Labor market might become even more favorable if the death rate or retirement exit rate picks up for whatever reason. Workers 65+ on Medicare and a bit older than that on Social Security have a stronger position to operate from in the labor market.
ok123456 is correct [1] that labor is not super fungible (white collar->Flying J clerk), but importantly, while there is uncertainty, this is not early 2000s or 2007-2008 financial crises from a labor market softening perspective.
Indeed, and unemployment coffers are mostly full, so collect whatever benefits you can between roles. Have a robust emergency fund, don't overextend with unproductive debt. I believe you can collect Social Security and unemployment at the same time (if applicable due to age) as well (but double check).
Statistically, factually, there is no recession. If anything a big chunk of the media likes to pick out anecdotes like this and say there is a recession when there isn't.
There were a whole bunch of layoffs a year ago too and people like you were saying the same thing, and you were wrong. At least wait for the monthly job numbers before you launch into the same tired spiel about the lying media.
Legal, compliance, customer service, investment banking, engineering, sales, marketing, IT, risk management. When it comes to large clients, you probably have multiple people just working on specific cases only. It balloons up when you multiply you by different locations and regulations.
I work at a similar bank. We have ~100 employees dedicated to mainly one regulator. There are hundreds of regulators worldwide. Of course there is some overlap in functions so its not 100s*100 but... running a bank is a hard business.
> It is strange and horrible that it is become like that, but that's where we are.
Given that in very recent times we got to experience what happens when people handling money completely ignore regulations, I'm quite happy banks are "compliance businesses".
Banks should be boring businesses focused on taking deposits, making loans and other variations of that sort of capital allocation. Whenever a bank talks about "new financial innovations!", run for the hills because it's invariably a way to separate customers from more of their money.
When bank is about to go under due to some new esoteric product which _should_ work (like packaging risky debt into magically risk-free securities) but eventually doesn't, it is MY money that's going to be used to pay for the losses. Because the bankruptcy would be a "systemic risk to the economy". So you bet I want banks to be constantly audited to make sure they don't make any dumb bets which I will have to cover for.
Plus customer facing employees aren't just the people in the branches, there's a massive volume of phone/email/etc support any large credit card issuer receives on a daily basis.
Citi used (And maybe still are not sure) to be the biggest retail bank in the world. I'm not sure how exactly that was quantified but I'd assume its related too phsyical footprint. If thats the case I could see mid and back office functions ballooning
As a retail and business customer of both Citi and Chase, there is no comparison. It would be illogical to use Citi given how great Chase's service is.
While there are probably many factors, you cant be that comparatively bad for a competitive and fungible service -- and expect no business consequences.
When comparing banks, I am comparing the banking service and not the rates. The recommended practice would be to keep just as much as you need in your checking/emergency accounts for month to month usage -- and have the rest of your funds in an independent investment/savings account, probably with a different institution. Ideally you time your auto-investments so the money gets invested as soon as it lands in your account via paychecks, etc.
Theoretically, lets say you keep 5k buffer in your checking account. The amount goes up and down as you get paychecks, pay out your rent, credit card bills, etc. That average 5k balance at 5% interest gets you $250 annually, or about $21/mo in interest. You'll give away 30% of that to taxes, so the "opportunity cost" of your checking account is ~$14/mo.
A serious question for any busy professional (as many of us are here) -- is chasing after this $14/mo worth the cost of a substandard checking account and bank service? My experience is that good banking service pays for itsself.
I'll give examples:
- One inexplicable fee from a bad bank will wipe out your monthly monthly interest
- If you have to wait on hold for 1hr to fix it, you've already lost way more
- If you have to pay fees left and right for things like certified checks, again you have lost the interest
- If you have fraud on your account and spend >2hrs dealing with it because the bank is unwilling to help or sends you to some offshore call center, again you lose.
- Suddenly need a statement from a year ago? Some banks will charge for that. HSBC (last I used) neither returns your checks nor shows images of your checks, so you have no record of checks unless you keep them.
A great bank has all sorts of fringe benefits. Mine will even do notary service for free. Mine will give near spot FX rates on overseas ATM withdrawls.
For US customers I would wholeheartedly recommend Chase, no need to be penny-wise pound foolish.
