Wells Fargo has certainly led the way in the banking sector when it comes to things like massive scandals and botching Small Business Relief Loans - so why not lead the way when it comes to announcing massive layoffs?
That's exactly what the bank has done. Under pressure to lower its costs, the bank "quietly ended a moratorium on terminations in recent weeks" according to the LA Daily News. The move is seen as the bank preparing to make deep job cuts.
Beth Richek, a spokesperson for the bank, offered up a perfunctory dodge: “Starting in early August, we resumed regular job displacement activity.”
She continued: “We are at the beginning of a multiyear effort to build a stronger, more efficient company. We expect to reduce the size of our workforce through a combination of attrition, the elimination of open roles and job displacements.”
Chief Executive Officer Charlie Scharf said last month: “We have a series of employees who’ve been told that their jobs will ultimately go away. But we are going to let some time pass as we got through the initial stages of the COVID crisis.”
Tens of thousands of jobs could be on the chopping block, according to the report. Scharf said: “It’s like an onion: The more we do, the more clearer the next round will become.”
Cuts will begin with people the firm had originally planned to let go this year, prior to the Covid crisis. Those cuts will move on to additional employees and an effort to "thin management ranks" and "remove underperformers".
Recall, the bank reported its first quarterly loss in over a decade and slashed its dividend by 80% this year. The cuts could open the floodgates for other banks to act accordingly, citing Wells Fargo as their "all clear".
U.S. banks have mostly abstained from cutting employees this year, despite European banks engaging in active talks to cut their workforces.