For a long time, the financial world has seemed like the unstoppable behemoth of the American economy. The Wall Street Journal notes, however, that the sector is hardly immune to market forces, as evidenced by a growing wave of layoffs sweeping across some of the biggest financial firms.
Just since last Tuesday, layoff announcements between 100 and 600 people have come from Credit Suisse and Barclays. Other banks are expected to announce cuts in coming weeks.
“Banks are chopping a lot of wood, both deadwood and live wood,” Michael Karp, managing partner at consulting firm Options Group, told the Journal.
The layoffs are hardly on a whim, but follow steadily dropping revenue from a range of investments as well as services. Daily trading has steadily declined over the past year, dropping 31 percent from the second quarter of 2010 and 10 percent from last quarter. Projections for the first half of 2011 estimate a 10 percent decline in revenue from last year.
Some firms, like Bank of America, are simply closing units involved in some of the markets targeted by the new Dodd-Frank financial reforms.
The BBC, meanwhile, reports that the British financial sector has actually grown substantially, despite upcoming cuts among some banks.