Goldman Sachs’ newest cost-cutting initiative, internally nicknamed “Challenge Voyage,” will ask choose managers to maneuver from central hubs just like the financial institution’s downtown New York Metropolis workplace to rising places like Salt Lake Metropolis and Dallas — or go away the corporate.
Based on a Bloomberg report, the funding financial institution is delivery its managers to rising locales to assist develop expertise pipelines in areas the place the corporate is rising, due to the efforts of primarily junior-ranking staff.
Transferring managers to Dallas and Salt Lake Metropolis may additionally permit Goldman to capitalize on workplace house. The price of renting a business workplace constructing in Manhattan was about $80 per sq. foot, in comparison with round $26 per sq. foot for Salt Lake Metropolis and Dallas.
In the meantime, Goldman is constructing a $500 million campus in Dallas in 2028 and is on observe to extend its present headcount of 4,600 staff within the space to five,000 by the point the workplace opens.
Residing and dealing exterior of NYC additionally gives staff extra worth to their paychecks — NYC’s value of dwelling is 130% greater than the nationwide common, with a median hire of $7,749 per thirty days, per Payscale. In the meantime, Salt Lake Metropolis’s general value of dwelling is 10% greater than common, with a median hire of $1,944 per thirty days, and Dallas’ value of dwelling is 2% greater, with a median hire of $1,497 per thirty days.
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As a part of Challenge Voyage, Goldman Sachs is gearing to chop round 3% to five% of its 46,500-person workforce within the coming months. The Wall Avenue Journal reported earlier this week that Goldman will make cuts within the spring this 12 months, as a substitute of in September because the financial institution has completed lately.
Based on Enterprise Insider, Goldman divisional heads are at the moment figuring out who to chop and relocate. Some jobs which are misplaced via cuts this spring will probably be backfilled with roles exterior of New York in lower-cost locales like Dallas.
In the long run, Goldman seeks to cut back bills by $1.3 billion general by shedding some staff and transferring others to lower-cost places. The financial institution first voiced the target at its first-ever investor day in 2020, per Bloomberg.
Challenge Voyage started within the fourth quarter of 2024 as a multi-year initiative to save lots of the corporate cash, per BI. The layoff and relocation plan impacts a number of divisions throughout the financial institution, together with world banking and markets, engineering, advertising, and operations.
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Based on the WSJ, the layoffs will concentrate on lowering the variety of vice presidents at Goldman. VPs, a bunch between associates and managing administrators, are a big and dear a part of the financial institution, with their ranks ballooning out far sufficient lately that VPs have been reporting to different VPs as a substitute of managing administrators, per BI.
Glassdoor knowledge reveals {that a} Goldman VP can value the financial institution as much as $325,000 in base pay per 12 months. Third-year VPs can earn over $1 million in wage and bonuses, a Goldman headhunter instructed eFinancialCareers.
