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200,000 Global Bank Jobs May Be Slashed By Artificial Intelligence

Major Wall Street banks are expected to slash up to 200,000 jobs over the next three to five years due to AI adoption, according to Bloomberg Intelligence.

The Finance Story by The Finance Story
Published date: 11th January, 2025
Last edited date: 29th January, 2025
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200,000 Global Bank Jobs May Be Slashed By Artificial Intelligence
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  • “AI is coming for your jobs” – a phrase that’s sounding less like a prediction and more like reality with each passing day.
  • Case in point: the financial sector.
  • According to a recent Bloomberg Intelligence report, AI is set to replace 5% to 10% of the workforce in global banks in the next 3-4 years.

What’s happening?

According to Bloomberg Intelligence, global banks are bracing to cut as many as 200,000 jobs over the next three to five years.

And this is no random prediction – They surveyed CIOs / CTOs (chief information and technology officers) and nearly 25% predict workforce reductions between 5% and 10%!

Citi’s report

On a similar note, in 2024, Citi released a report highlighting the growing role of automation in banking and finance.

The report predicted that the banking industry is set to be the hardest hit by AI deployment, with:

  • 54% of roles are at risk for AI-led job displacement.
  • An additional 12% of jobs are potentially augmented by AI.

Other industries facing significant AI disruption include:

  • Insurance: 48% of roles are at risk.
  • Energy: 43% of roles are at risk.
  • Capital markets: 40% of roles at risk.

Which roles are at risk of being eliminated?

AI is charging full steam ahead into roles that rely on routine and repetition.

According to Bloomberg Intelligence’s report, the following roles will be affected the most,

  • Back office
  • Middle office
  • Operations
  • And even customer service isn’t off the hook, with bots stepping up to take over client interactions and KYC duties.

Which Banks are at the forefront of this transformation?

Bloomberg Intelligence’s peer group includes industry giants like:

  • Citigroup Inc. (Headquartered in New York, Citi has over 240,000 employees worldwide)
  • JPMorgan Chase & Co (It has more than 316,000 staff worldwide)
  • Goldman Sachs Group Inc (45,300 employees at the end of 2023, down 3,200 (-6.6%) from the previous year!)

Let’s take a closer look at their AI initiatives

Citigroup

In 2024, Citigroup began rolling out new AI tools across eight countries, making them accessible to around 140,000 employees.

In a memo to staff, Citi introduced Citi Assist, an AI tool designed to help navigate internal bank policies and procedures.

It’s like having a super-smart coworker at your fingertips, guiding you through HR, risk, compliance, and finance.

Don’t forget Citi also fired quite a few in 2023 and 2024!

JPMorgan Chase

As the largest bank in America, JPMorgan has already embraced AI across several functions, including error detection, trading, research, and hedging.

They’re leading the charge in optimizing key processes with AI technology.

In an interview with Bloomberg TV, JPMorgan CEO Jamie Dimon predicted that people might work fewer days in the future, thanks to technology.

He envisions a future where AI automates 60% to 70% of current tasks, potentially shrinking the workweek to just 3.5 days!

Goldman Sachs

In 2024, Goldman Sachs rolled out its first generative AI tool for code generation to thousands of developers across the company.

Known as the GS AI Platform, it serves as the central hub for all generative AI initiatives at the firm. This strategy allows the firm to tailor the AI to various use cases.

The bank is also working on AI tools for language translation and summarizing proprietary research, providing valuable insights to their advisors.

AI is expected to significantly boost their profits!

While this may be bad news for employees, it’s certainly great news for the banks.

Bloomberg Intelligence estimates that by 2027, banks could see:

  • Pretax profits 12%–17% higher, adding up to $180 billion to their collective bottom line.
  • Increased productivity and revenue generation by at least 5%, according to 80% of surveyed executives.

Some say AI is here to augment roles, not replace them!

While the idea of job losses is certainly concerning, some experts state that AI isn’t solely about replacing workers.

Sure, some jobs will disappear, but new ones will take their place.

Repetitive tasks will be automated, transforming the workforce.

AI will lead to faster processes, lower costs, and a more productive workforce.

This shift will free up an employee’s time to focus on what truly matters: creativity, judgment, and innovation.

How employees can survive (and thrive) in the Age of AI

The obvious – re-skilling!

Employees have no option…it’s something they will need to do.

Develop New Skill Sets for AI Tools and Processes: As AI becomes a key part of business operations, acquiring new skills to work with AI-powered systems will be crucial for staying competitive.

Continuous Learning to Stay Ahead: Technology evolves fast, so regular education through courses and training is essential to keeping up with the latest advancements in AI.

Computer Science & Programming: A solid understanding of AI systems and how they work will be essential for professionals looking to stay relevant in a tech-driven world.

Data Analysis & Statistics: With AI generating vast amounts of data, those who can interpret and make sense of these insights will be in high demand.

AI Strategy Development: The demand for expertise in building and implementing AI systems is growing. Understanding how to integrate AI into business strategies will become an increasingly important skill.

Wrapping up

These banks are setting the stage for a new era of AI-driven finance. The question is: how will the rest of the industry keep up?

AI’s impact on the financial sector is undeniable, but it’s not all bad news, after all.

What are your thoughts?  Are you afraid your job is on the line?

The Finance Story

The Finance Story

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