The phenomenon is hitting New Jersey as some of the world's largest banks and financial institutions cut jobs to tighten budgets amid economic uncertainty.
Bank of New York Mellon Corporation, TD Bank, Prudential Financial, Citibank and JPMorgan Chase Bank are among the financial institutions that have announced layoffs in New Jersey through 2024, according to data in state filings. There are 5 companies.
These follow on from financial sector job cuts implemented or announced in 2023 by JPMorgan Chase Bank, Prudential Financial, TD Bank, and Charles Schwab.
Some of these banks, including Citibank and Charles Schwab, are cutting thousands or even tens of thousands of jobs.
Charles Schwab will cut 2,000 employees, and Citibank will cut 20,000.
“Banks are reducing back-office costs, which unfortunately includes reducing headcount and employee numbers,” said Christopher Marinak, director of research at financial services firm Janney Montgomery Scott. Stated. “Overall, bank earnings have been stable and generally not growing. Additionally, bank balance sheets have not expanded much this year.”
Is it one factor? The Federal Reserve has raised interest rates 11 times since the coronavirus pandemic. This has caused mortgage rates to rise for homebuyers, fewer people taking out mortgages, and Wall Street has responded by cutting jobs, CNBC reported.
The result was the state's first job loss in six months, according to unemployment statistics.
“Banks are being cautious about new lending and looking to hold more capital as the Federal Reserve tightens standards and soon raises capital requirements,” Marinak said.
Rutgers University economist James Hughes told NorthJersey.com that white-collar jobs in banking and finance are saturated after a two-year hiring rush following the COVID-19 pandemic. He said it happened.
Headcount reduction in numbers
The following financial services companies have announced job cuts in New Jersey in 2023.
- JPMorgan Chase Bank: 63 jobs.
- TD Bank: 88 jobs.
- Prudential Financial: 46 jobs.
- Charles Schwab: 109 jobs.
The following are the announced layoffs for New Jersey's banking sector through 2024:
- Bank of New York Mellon Corporation: 62 jobs.
- TD Bank: 54 jobs.
- Prudential Financial: 145 jobs.
- Citibank: 187 jobs.
- JPMorgan Chase Bank: 91 jobs.
JPMorgan, widely considered the nation's largest bank, is one exception to this trend, having made some hires despite layoffs in New Jersey this year.
The state employs 12,000 people, 10,000 of whom are in Jersey City, and has 600 open positions, a spokesperson said. JPMorgan Chase Bank added 17,000 jobs last year, on top of 11,000 open positions, according to a company spokesperson. The company announced plans to lay off hundreds of employees in its mortgage division in 2022.
JPMorgan's workforce has increased 21% since the start of the 2020 pandemic, according to its annual report.
Daniel Muñoz covers business, consumer affairs, labor and economics for NorthJersey.com and The Record.
Email: munozd@northjersey.com; twitter:@Daniel Munoz100
