U.S. banks could cut 200,000 jobs in the next 10 years, a senior analyst said
U.S. banks represent 200,000 jobs, or 10% of employees, over the next decade as they strive to increase profits from customer change, according to a banking expert.
“This is the biggest decline in US banks in history,” Wells Fargo analyst Mike Mayo told the Financial Times. When his predictions are fulfilled, this year will be a sign of Part of a US bank, where job growth has remained at about 2m over the past 10 years.
High-risk activities are located at the branch and call centers where banks set up their networks to match the realities of the banking system after the epidemic, a Mayo report found. This is in line with figures from the Department of Labor, which predict a 15% reduction in bank overcrowding over the next decade.
In the past, layoffs, especially in low-paying jobs, have been difficult for the banking industry, which is often seen by the prosperous politicians as an example of a rich business that puts profits ahead of the people.
But the risk of professional and non-performing lending companies failing to repay their loans, which have been controlled by banks, has increased over the past year, making jobs more important, Mayo said.
“Banks need to be more profitable in order to stay relevant. And that means more computers and fewer people, ”he said.
Significant reductions are likely to be achieved through incentives over the next 10 years instead of cutting, which reduces the risk of relapse, says Mayo.
The new study, first reported by FT, comes recently on disappointing figures showing that the U.S. economy added 266,000 jobs last month, which needs to be compared to 1m. Unemployment tools such as the scourge that took place during the epidemic may be more powerful than expected to resume operations, Financial officials said following the report.
The outbreak was forced to increase by about 2% last year when banks hired people to meet the urgent needs of debt-paying housing and government-subsidized small businesses. But this could change in the near future as lenders look again at a competitive job with technology companies that have expanded their financial sector during the health crisis.
Increased competition from unregulated companies such as PayPal and Amazon for financial transactions was one of the major issues for JPMorgan Chase Jamie Dimon wrote it in his annual letter to shareholders last month.
Mayo estimates that banks here represent one-third of all financial markets.
“Digitization has grown exponentially and has played into the power of some fintech and other technology makers,” Mayo said.
Many bank branches that were closed during the epidemic can remain so, and even those that are open should be limited as branches focus more on providing technology rather than on managing events. Most back-end jobs also have to be self-made but the numbers are hard to figure out, the report said.
Mayo said his team 20 years ago had doubled in size and led by half. Doing more and less was a new way to market.
“If I were to give advice to my children, I would say that maybe you don’t want to go out and get involved in the economy,” said Mayo, adding that technology and customer service or customer service are probably the only ones that will see growth. “It seems to be getting worse.”