Let the Wall Street Culls Begin

After a pandemic pass, bosses from Goldman’s David Solomon on down are cutting jobs and maybe bonuses

- David Papadopoulos

JPMorgan Chase and Co. executives were in a bind. Amid a flurry of job-hopping on Wall Street last year, Chief Executive Officer Jamie Dimon had told the bank’s US staff it was time to return to offices on a regular basis. But with Covid-19 cases climbing at the time, some managers were reluctant to take a hard line with staff who could quit. A number of divisions were already wrestling with resignations and racing to refill positions.

So an informal strategy emerged to shield the rank and file from the CEO’s dictate without antagonizing him, according to people with direct knowledge of the matter, who asked not to be named discussing internal practices.

Anyone who Dimon might possibly walk the halls looking for, such as a managing director, needed to come into the office. They just couldn’t take the risk. Many others, though, were given leeway to keep working from home discreetly. The recruiters were busy enough. ( Joe Evangelisti, a spokesman for the bank, says assertions that such a system existed are “false.”)

One year later, as the economy slows and financial markets slump, the mood on Wall Street is quickly changing. The sense that it’s an employee’s job market where the rank and file can set their own terms is fading. Ignoring edicts from the C-suite is now a dangerous game. Few would dare.

At a small but growing number of firms, job cuts are back on the table. This month, in a warning shot heard around the financial world, Goldman Sachs Group Inc. CEO David Solomon, another return-to-office stalwart, resumed the firm’s practice of periodically culling underperformers to make way for new talent—an unsavory ritual that had been put on hold because of the pandemic.