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Business
on the money

Goldman Sachs’ back-to-office directive may signal more looming layoffs

By
Lydia Moynihan
Published Aug. 24, 2023
Updated Aug. 24, 2023, 4:01 p.m. ET

Goldman Sachs CEO David Solomon may not have a problem getting his bankers back to the office five days a week — and the reason starts with an “L.”

Even before Goldman bankers received what one insider called a “gentle reminder” about the five-day directive earlier this week, some of the rank and file claim they were already planning to step up attendance after Labor Day, On The Money has learned.

That’s because fears are reigniting about another possible round of layoffs, sources said.

Goldman most recently axed 250 employees in June, including 125 managing directors.

In January, Solomon slashed 3,200 workers — the most since the 2008 financial crisis. Workers dubbed the chilling bloodbath “David’s Demolition Day.”

Now, although Goldman has said nothing about additional layoffs this year, reported cuts at Charles Schwab this week were enough to spark fears that the culling could be contagious.

“There will be a spike in return to office because of layoff fears,” one employee said.

Illustration of banker being laid off
Fears are reigniting about another possible round of layoffs at Goldman Sachs, sources said. Paola Morrongiello

If it isn’t layoffs, it could be another year of disappointing bonuses, insiders fear.

At issue: dealmaking — or a lack thereof. In particular, IPOs don’t appear to be picking up despite the market’s ebullience after Cava’s rocketing IPO. 

The hope had been that other companies would be eager to follow suit, setting off a new bull market.

Canned water company Liquid Death hired bankers to prepare for an IPO and chipmaker Arm has filed to go public. 

While bankers are on tenterhooks as the deals aren’t yet moving forward, others say a summer lull is to be expected and it’s too soon to jump to any conclusions. 

SPACinsider’s founder and CEO Kristi Marvin notes that “the best companies that would be suitable for an IPO are probably not going to be first out of the gate.”

Marvin also notes that company valuations have taken a major hit since 2021.

The hope is that the market recovers a bit more and there is less volatility, she told On The Money. 

“September will be a better judge of a pickup in activity,” Marvin said. “I don’t see anyone pulling the trigger on anything until September.”

Meanwhile, some employees who’ve been schlepping into the office five or even six days a week this summer have been baffled by the fact that colleagues got leniency.

“What summer Fridays?” one Goldmanite griped.