Goldman Pursues "Jobless Growth" as AI Reshapes Banking Workforce

Goldman Sachs Group Inc. is preparing for another round of job cuts in 2025 as part of a strategic push to integrate artificial intelligence across its operations, according to an internal memo reviewed by Bloomberg NewsGoldman tells staff it will cut more jobs as AI saves costs^[1]. The New York-based bank plans to "constrain headcount growth through the end of the year" and implement a "limited reduction in roles across the firm," signaling a continued commitment to cost discipline amid a broader industry shift toward AI-driven efficiencyGoldman Tells Staff It Will Cut More Jobs as AI Saves Costs^[6]. Despite the cuts, the firm expects to finish 2025 with a net increase in overall headcount, with global staffing at 48,300 as of September-nearly 2,000 higher than a year earlierGoldman Sachs warns of looming layoffs as AI reshapes operations^[3].

The moves are tied to the launch of "OneGS 3.0," a multiyear initiative aimed at transforming the bank's operational framework through AI and automation. Executives, including CEO David Solomon, President John Waldron, and CFO Denis Coleman, emphasized in the memo that AI will be central to reengineering processes in areas such as client onboarding, lending, regulatory reporting, and vendor managementGoldman tells staff it will cut more jobs as AI saves costs^[1]. "While we are still in the early innings in terms of assessing where AI solutions can best be deployed, it's become increasingly clear that our operational efficiency goals need to reflect the gains that will come from these transformational technologies," the memo statedGoldman Tells Staff It Will Cut More Jobs as AI Saves Costs^[6].

Goldman has already begun deploying AI tools internally, including the GS AI Assistant, a generative AI system rolled out to over 46,000 employees to automate tasks like document drafting and data analysisGoldman Sachs Sounds the Alarm: AI-Driven Job Cuts Reshape …^[2]. Early results show a 10-15% increase in task efficiency and a 20% productivity boost in departments using the tool. The bank is also investing in autonomous AI agents to manage software development lifecycles, potentially tripling engineering productivityGoldman Sachs Sounds the Alarm: AI-Driven Job Cuts Reshape …^[2]. These advancements underscore a broader strategy to embed AI into core functions, moving beyond incremental upgrades to a "front-to-back" operational overhaulGoldman Sachs Plans Job Cuts in New AI Operations Overhaul^[4].

The job cuts come amid a broader industry trend. Rivals like Morgan Stanley and JPMorgan Chase are also reducing workforces as they prioritize automationGoldman Sachs warns of looming layoffs as AI reshapes operations^[3]. Goldman's third-quarter results highlighted the tension between cost-cutting and revenue growth: while investment banking revenue outpaced competitors, expenses rose, contributing to a stock price dip on the day the memo was releasedGoldman tells staff it will cut more jobs as AI saves costs^[1]. The bank has cut 700 jobs this year during its normal annual review and plans further reductions in roles deemed automatablegoldman sachs job cuts: Goldman Sachs to have more layoffs?^[5].

However, the impact of AI on employment is nuanced. Goldman projects a long-term net increase in headcount as efficiency gains free up resources for growth areasGoldman Sachs Plans Job Cuts in New AI Operations Overhaul^[4]. The firm's leadership stressed that AI adoption requires "greater speed and agility" across all operations, not just technological retoolingGoldman tells staff it will cut more jobs as AI saves costs^[1]. This includes reorganizing teams, refining decision-making processes, and upskilling employees to align with AI-driven workflowsGoldman Sachs Plans Job Cuts in New AI Operations Overhaul^[4].

Analysts caution that the shift could exacerbate labor market disruptions, particularly for entry-level and back-office roles. A Bloomberg Intelligence study estimates up to 200,000 finance jobs could be lost industry-wide within five years due to AI adoptionGoldman Sachs warns of looming layoffs as AI reshapes operations^[3]. Goldman's own research suggests 300 million global jobs could be exposed to automation, with U.S. white-collar roles facing significant transformationGoldman Sachs Sounds the Alarm: AI-Driven Job Cuts Reshape …^[2]. While the bank frames its strategy as a path to "jobless growth," critics highlight ethical concerns around displacement and inequalityGoldman Sachs Sounds the Alarm: AI-Driven Job Cuts Reshape …^[2].

Goldman's approach reflects a pivotal moment in the financial sector's AI adoption. By prioritizing AI integration, the bank positions itself to lead in efficiency and client service but also sets a precedent for how other institutions might balance technological progress with workforce adjustmentsGoldman Sachs Plans Job Cuts in New AI Operations Overhaul^[4]. The success of OneGS 3.0 will hinge on its ability to deliver promised productivity gains while managing the human and societal costs of automation.