Morgan Stanley plans to cut another 3,000 jobs

Morgan Stanley is making plans to cut 3,000 more jobs by the end of June as the Wall Street bank heads down to survive a prolonged slump in dealmaking.

People familiar with the discussions say senior managers aim to weed out the roughly 5 percent of staff, excluding client-facing financial advisors in Morgan Stanley’s wealth management division, who will be shunned.

The cuts will be widespread throughout the rest of the New York-based bank, which employs 82,000 people. The investment banking and securities divisions are expected to be affected more than other parts of the bank.

Banks have already embarked on the biggest round of job cuts since the 2008 financial crisis, and many of the law firms, consultants and accounting groups they work with have left people, too.

Work has dried up on initial public offerings and mergers and acquisitions, as global dealmaking suffered its weakest year-to-date start in a decade. That leaves organizations that have scrambled to handle the booming business during the coronavirus pandemic with more people than they need.

For Morgan Stanley, this will be the second round of cuts in less than six months. It laid off 1,800 employees in December, or just over 2 percent of its workforce. At the time, the bank said it did not expect further cuts.

Morgan Stanley declined to comment. The planned round of cuts was first reported by Bloomberg.

Chief Executive Officer James Gorman warned last month that investment banking “remains very weak” and predicted that revenue may not recover until 2024. The bank’s first-quarter profit fell for the fifth year on an annual basis. Gorman took a 10 percent pay cut for 2022, reflecting the company’s weaker performance compared to 2021.

Lazard said last week it plans to cut its staff by 10 percent, and Goldman Sachs announced it would cut 3,200 jobs in January, in part because of a slowdown in deal-making and its efforts to reduce retail banking. Those cuts amounted to about 6.5 percent of Goldman’s employees.

Citigroup, Bank of America, and Wells Fargo have all culled jobs so far this year, as have law firms, including Kirkland & Ellis, and the Big Four accounting firms.

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