American multinational investment bank and financial services company Goldman Sachs has revealed plans to eliminate more than 3,290 positions as it battles a tough economic environment.

The investment bank revenue plunged massively last year, amid a slowdown in Mergers and share openings, marking a massive reversal from profitable 2021.

This has spurred the bank to propose the laying off of over 3,000 jobs, although sources disclose that it is an estimation as the final number is yet to be disclosed.

Recall that last year in December, Goldman Sachs revealed plans to cut thousands of employees to navigate a difficult economic environment.

The company’s CEO David Solomon revealed that the headcount reduction will begin in January 2023, in an open letter to all workers.

The CEO wrote in his letter, “We are conducting a careful review and while discussions are still ongoing, we anticipate our headcount reduction will take place in the first half of January 2023.

“There are a variety of factors impacting the business landscape, including Tightening monetary conditions that are slowing down economic activity. For our leadership team, the focus is on preparing the firm to weather these headwinds.”

Goldman Sachs is currently going through a critical period in its finances, as the company’s net sales were down 57 percent year-on-year in its third quarter (Q3) report for 2022.

Also, its net revenues from corporate landing were down to 77 percent, while equity underwriting was down to 79 percent compared to the third quarter (Q3) of 2021.

It is however interesting to note that as the Investments bank revenue and profits declined in the past years, its headcount rose significantly. It had a total of 49,100 employees at the end of the third quarter after it added a significant number of staff during the Covid-19 era.

Investors King understands that Goldman Sachs is not the only financial firm that is currently faced with headwinds due to the current economic downturn that has affected the global financial market.

Other financial giants such as Deutsche Bank, Barclays, Morgan Stanley, and Credit Suisse Group, have all slowed down hiring, with some laying off some of their workforces to navigate the economic downturn.

The Federal Government has set a presidential panel on salary increments for civil servants in order to reflect the increase in the prices of consumer goods.

The Minister of Labour and Employment, Chris Ngige, disclosed this to State House correspondents after a closed-door meeting with President Muhammadu Buhari, noting that the panel is currently reviewing salaries with a plan to announce its decision in early 2023.

Investors King could recall that the Minister of Labour and Employment had earlier insinuated that the FG will review the salaries of civil servants upwards to cushion the effect of inflation.

While speaking to journalists, Ngige said “the Presidential Committee on Salaries is working hand-in-hand with the National Salaries, Incomes and Wages Commission. The commission is mandated by the Act establishing them to fix salaries, wages, and emoluments in not only the public service”. 

Citing the 8-month-long ASUU strike and strikes by medical practitioners earlier in the year, the minister further noted that 2022 was a tough year for the ministry. He described 2022 as “a year of industrial dispute.”

It would be recalled that the Academic Staff Union of Universities embarked on an industrial strike over unfulfilled agreements with the Federal Government. Thereby paralysing academic activities in universities across Nigeria. 

While the Federal Government had a rough year with labour unions, Ngige, however acknowledged that the private sector was able to manage its affairs better. He noted that there was calm in the private sector, unlike the public sector.

“They could do collective bargaining very easily with their workers. The banking sector, food and beverage, finance, and insurance, everywhere. So, there is calm there. We didn’t have the desired calmness on the government’s side because of the government’s finances”. 

When asked when there will be an update on the salary review, the minister said “as we enter the New Year, the government will make some pronouncements in that direction. Hopefully, within available resources, the government can do something in the coming year.”

The World Bank has Nigeria’s poor job creation habit could plunge additional 23 million people below the poverty line by 2030 while 80 million working Nigerian adults may not have full time job by 2030.

The multilateral financial institution said, “Per-capita income will plateau, 80 million working-age Nigerians will not have a full-time job by 2030 if the employment rate does not improve, and 23 million more Nigerians will live in extreme poverty by 2030 if the poverty rate does not fall.”

However, explaining the significance of new job creation, the Washington-based bank stated, “Creating better jobs is a necessary condition for accelerating poverty reduction and economic transformation.

“It is estimated that 3.5 million Nigerians enter the labor market every year, a number that cannot be absorbed by a public sector-led economy. This large number represents 41 per cent of the total new entrants in the labor market in West Africa.

“However, even if job creation were to catch up with the expansion of the labor force, Nigerian workers would not fully benefit if other socio-economic conditions remain unchanged. A child born in Nigeria today will be 36 per cent as productive in adulthood as she could be if she enjoyed more and better-quality education and full health (the sixth-lowest percentage globally).

“A combination of limited job creation, booming demographics, and unfulfilled aspirations is pushing young Nigerians to emigrate abroad in search of gainful employment.”

The financial institution said private investment would help boost job creation and enhance the quality of jobs in a sustainable way in Nigeria since the private sector is at the heart of the development process and has been a critical component in every sustained growth success story around the world.

It said, “In Nigeria, the private sector is responsible for an estimated 90 per cent of GDP and 94 per cent of jobs, and thus is the only option for creating job-enhancing growth.”

It added, “Hence, despite the current challenges, Nigeria can still chart a sustainable and inclusive growth path based on solid economic institutions with a sound macroeconomic environment that reduces regional disparities, strong human capital that will help children reach their full potential and acquire the skills needed for a modern economy, and productive firms that create more and better jobs.”