Citigroup To Cut 20,000 Jobs (bnnbloomberg.ca) 53
Citigroup said it expects to incur as much as $1 billion in severance and reorganization costs this year as it continues the process of eliminating 20,000 roles as part of Chief Executive Officer Jane Fraser's quest to boost the Wall Street giant's lagging returns. From a report: Total expenses for the year will likely be between $53.5 billion and $53.8 billion, the New York-based bank said Friday. That would be a decrease from the $56.4 billion the firm spent in 2023.
Wall Street rewards employee cutbacks (Score:5)
Why reward companies that fire employees without the executives who led them being fired or resigning too? If you're doing a mass layoff, it means the executives made some bad decisions and either hired the wrong people or went after something unattainable. That's fucking incompetent, if not cruel. So anyway, investors should demand executives --including the CEO resign too when there are layoffs. Human beings are not to be used and discarded willy nilly.
If investors won't demand it, we may need regulatory solutions that enforce such things.
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If you're doing a mass layoff, it means the executives made some bad decisions and either hired the wrong people or went after something unattainable.
Or there is new technology that reduces the need for x amount of employees.
Or there is less buisness or changes that require so many employees.
Or processes have been streamlined making some departments redundant.
Your reason could be the right one but to assume it is the only possibility is naive.
Re: Wall Street rewards employee cutbacks (Score:3)
Yeah, why not? (Score:2)
You're unlikely to drastically change your voting habits and put people in charge who will regulate banks strictly and enforce anti-trust laws. You probably have half a dozen issues more important. And short of government action the banks or too rich and too powerful for individuals to do anything about it.
These are the incentives we
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Right. Or they could just not do anything. Just let your IT be the cheapest possible solution and your information gets into the wild and when they get caught lie and pay off politicians.
You have to remember, IT is a cost. It doesn't produce anything of value. It doesn't do anything really useful. It's just a bunch of guys clicking buttons and typing funny words.
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Have I missed a scientific breakthrough that makes thousands of jobs instantly redundant? I frankly haven't seen anything like that since the advent of Xerox machines that made the armies of typewriters redundant.
And even that took years.
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There is a possibility that they overhired during the pandemic.
There's also a possibility that they're doing this in advance of reorgs that will result in units being spun off or sold to make their balance sheets look better.
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Weird that it's never the CEO that gets axed. Just think of the effect on stock value if they cut that amount of dead weight!
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Sandy Weill (1998-2003)
Charles Prince (2003-2007)
Vikram Pandit (2007-2012)
Michael Corbat (2012-2021)
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That's normal. No CEO stays longer than 3-5 years normally, after all it's the golden parachute that makes the deal sweet, not the petty change of a few millions a year they get in the meantime.
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CEO is actually quite a tenuous job.
CEO, head NFL coach, etc. are often short-tenure jobs where questionable results often lead to early termination. However, those positions are often also extremely well compensated financially, both in terms of on-job compensation as well as severance payments. It's amazing but usually true that the severance payment for a large corporation CEO is more than the 40-year combined lifetime earnings for a median-income worker. That is, failing at that CEO job is far more worthwhile financially than working h
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The inflexible labor markets and lemon socialism [wikipedia.org] that you advocate leads to stagnation and low productivity.
Both companies and employees do better where it's easy and common for employees to move between companies. Ideas and innovations spread, and employees are more likely to find jobs that fit their skills and personalities.
This is true when you compare countries but also when you compare states. California has laws, such as the ban on non-competes, that make it easy to job-hop and easy to lay off surplus
Re: Wall Street rewards employee cutbacks (Score:3)
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He probably would have wrote that if it's what he meant.
Re: Wall Street rewards employee cutbacks (Score:4, Insightful)
When you say "lemon socialism" you mean late stage capitalism with a Republican president. PPP loans are ok, student loan forgiveness is illegal.
Whether or not they were a good idea, PPP loans were just that... loans. They're paid back. "Student Loan Forgiveness" is bullshit puffery for "I'm entitled to have my bills paid by others". We have far too many people in college, and who went to college, that shouldn't have. Especially with majors that could never fetch a salary high enough to pay the debt they willingly took on. That bachelors in Social Work or the masters in medieval French Poetry was never going to get a job good enough for the 6 figures of debt incurred. "Student Loan Forgiveness" is the worst of two worlds: a reward for shirking obligations, and a bribe from politicians that pander to those people. Literally, "vote for me and I'll pay your debts with the taxes that other people worked for".
The concept also completely screws the people who paid their loans, as agreed. They get nothing. And the lesson that everyone learns is that responsible planning and behavior is for suckers.
And lastly, the lamentable fact that some companies get rewarded with bailouts isn't an excuse. One wrong doesn't justify two. Fix the first wrong, don't compound and expand it.
Re: Wall Street rewards employee cutbacks (Score:4, Interesting)
Colleges should be the guarantor for loans. They are the places selling useless majors to kids. Colleges should also be forced to publish surveys on how their grads of particular majors are doing and what they're earning 1, 3, and 5 years on.
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Colleges should be the guarantor for loans. They are the places selling useless majors to kids. Colleges should also be forced to publish surveys on how their grads of particular majors are doing and what they're earning 1, 3, and 5 years on.
Couldn't agree with you more, except on one subject: it's not just colleges pushing this stuff. American teens have been told for the last 75 years that college is the only way. Teachers, guidance counselors, principles, etc, have been parroting this line all my life. "It really doesn't even matter what your degree is in. Employers just want to see that you can finish something you start", etc.
Combine this doctrine with other destructive notions in pop culture ("Do what you love and the money will follow!")
Re: Wall Street rewards employee cutbacks (Score:2)
"PPP loans were just that... loans. They're paid back."
That is a lie. 96% of them were not.
Don't lie.
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Especially with majors that could never fetch a salary high enough to pay the debt they willingly took on.
No one takes on that debt willingly. That debt is a function of a broken education system. But please, do be the arbiter of human knowledge and capability that you so desperately think we need while ignoring the very real problems that education in the USA is crippling regardless of what degree you have. Modern developed nations have realised there's a meaningful benefit to an educated populace. But the USA still stuck in the 60s is just here to capitalise on this concept. Daddy's uni needs another football
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That's fucking incompetent, if not cruel.
I don't know that it would be less cruel to not hire them in the first place. I know I'd rather be paid for a few years and then have to sort out what next rather than not get paid at all. The average severance seems to be about $50k, which should be enough to sort out, on top of whatever unemployment provides.
Rather than 'used and discarded', your alternative is to jump straight to 'discarded'.
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You're assuming those 20,000 couldn't have had other more productive or secure jobs if at a slightly lower pay. By working for Citibank it's possible some of them had company-specific experience that won't help them find equivalent alternative jobs (for example they may have only worked with processes/software unique to Citibank).
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You assume that Citibank and only Citibank adopts this policy of being afraid of hiring people for fear of maybe one day not wanting to employ them anymore.
If *every* company decided to only ever hire if they knew beyond any shadow of a doubt that the hire would be desired for 30 years... Well you would have not nearly so many jobs. Even long timers would be unlikely to find a job since even most long-term positions are prospects the company isn't sure will work out or not.
I think it'd be more productive
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If *every* company decided to only ever hire if they knew beyond any shadow of a doubt that the hire would be desired for 30 years.
You know, we don't need it to be extreme on either side. There should be a way to solve this without the extreme of executives trying out whimsical ideas they aren't even passionate about versus preventing executives from taking risks that they've dedicated themselves to.
Re: Wall Street rewards employee cutbacks (Score:2)
To the extent there is a middle ground within the framework of a vaguely capitalist strategy, I think we are there. A company that exhibits a pattern of wasteful spend on initiatives that do not pay off is punished by investors and executives do get drummed out, frequently forced to "resign".
To the extent this doesn't cover the welfare of the employees, I think it would be daunting to try to make corporations adequately "take care" of employees, since they really don't want to and will do everything to loo
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>If *every* company decided to only ever hire if they knew beyond
>any shadow of a doubt that the hire would be desired for 30 years...
. . . you would look around, confused, wondering how you'd been transported to France!
More seriously, look at France for hard core, long term, employment security, and the negative effects on employment.
You may or may not find the tradeoffs worth it.
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Unemployment is rather high in certain groups, but doesn't the system mostly just create two classes of worker with CDD (fixed term contract) vs. CDI ("normal employment")? That does not seem so different from 1099 independent contractors / "gig" economy, etc.
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I'm hardly an expert on French government :).
The general bit on reluctance to hire until you're *certain* you can keep the person pretty much forever and the related chronic unemployed are one of those things you pick up along the way as an economist.
Whether or not the security is worth the economic hit can be argued either way (as long as you acknowledge the price being paid!).
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Well, the world needs ditch diggers too.
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You're assuming those 20,000 couldn't have had other more productive or secure jobs if at a slightly lower pay.
Moving people to lower paying jobs in the same company... with less responsibility and authority... generally doesn't work. It's a demotion, and the psychology of it inevitably leads to less production and more resentment. It also hurts their long term advancement. Being laid off because of a company-wide mass-RIF (reduction in force) isn't going to hurt you in interviews. Being demoted will.
If you feel that you should lay people off, it should be a clean break. Give 'em some severance, thank them for their
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I meant if Citibank hadn't offered them a job they were going to get fired from, they may have found or stayed at a different job (in a different company).
Because they're the ruling class (Score:2)
Some of my UK acquaintances have commented that the US is more stratified than they are. The difference is their upper class have specific accents so it's easy to spot them. Ours are clever enough to blend in so you don't notice the class distinctions.
Like Warren Buffet said, "There is a class warfare, and it's my class that's winning".
Of course it's easy
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we stopped calling them Kings & Dukes and what not because that was too on the nose, but make no mistake we very much have a ruling class. Some of my UK acquaintances have commented that the US is more stratified than they are. The difference is their upper class have specific accents so it's easy to spot them. Ours are clever enough to blend in so you don't notice the class distinctions. Like Warren Buffet said, "There is a class warfare, and it's my class that's winning". Of course it's easy to win a war when only one side knows it's fighting.
Nobody's daft enough to not know we're fighting. The problem is that the other side is looking at us with nuclear rockets mounted on their shoulders, and we're sitting here with rubber bands and pea shooters going, "YOU'D BETTER LISTEN, YA BETTER YA BETTER!" They pat us on the heads, tell us we're cute, then bend us over the nearest table and get back to fucking us. You can't fight them. Voting? It's a smokescreen. Every single candidate that EVER makes it past the primaries is either already a part of the
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Why reward companies that fire employees without the executives who led them being fired or resigning too? If you're doing a mass layoff, it means the executives made some bad decisions and either hired the wrong people or went after something unattainable. That's fucking incompetent, if not cruel. So anyway, investors should demand executives --including the CEO resign too when there are layoffs. Human beings are not to be used and discarded willy nilly.
If investors won't demand it, we may need regulatory solutions that enforce such things.
You aren't viewing things the way Wall Street views them. People mean absolutely NOTHING to Wall Street. Wall Street sees numbers. Cutting staff for any reason is a cost-cutting measure, and increases profit potential provided productivity doesn't drop from the cuts. If that profit potential is realized, Wall Street collectively masturbates over the felled workers and tells them to enjoy the salty-warm rain as they count their winnings from the roulette table called an economy, the government celebrates the
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You aren't viewing things the way Wall Street views them. People mean absolutely NOTHING to Wall Street. Wall Street sees numbers. Cutting staff for any reason is a cost-cutting measure, and increases profit potential provided productivity doesn't drop from the cuts.
Except that productivity always drops because of the cuts. 100% of the time. Guaranteed. Even if you just consider the work that the laid off people did, that's a productivity drop by itself. And everyone who knows those people becomes disheartened and works less hard, so that compounds the issue. I saw a study on this once, and I can't remember the exact number or where the study was from, but to the best of my recollection, it was something in the neighborhood of an immediate 20% loss of productivity
Not necessarily (Score:2)
"If you're doing a mass layoff, it means the executives made some bad decisions and either hired the wrong people or went after something unattainable."
If the world the company lives in were static, I'd give you that. But it's not. Sometimes the world changes and invalidates the decisions of previous caretakers. That doesn't mean that those that came before were "wrong"... it just means "no longer applicable."
Also, judging something was "unattainable" is unreasonable. Only doing what's guaranteed to succee
Expect more nice "reference catastrophes" (Score:3)
Citigroup has had some of the most demented IT security vulnerabilities ever found in a bank in the past. Since IT security is clearly not "productive", they will be trying to do this "cheaper" now again, with under-qualified people and not enough of those. Trying to force "high profits" at all cost typically does the contrary. Just look at Boeing. Although, admittedly, the Boeing people have a few bolts loose...
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Nothing. Provided you're an independent security consultant.
Then these are known as "total job security". Or, in short, KA-CHING!
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Hehehehehe, true. The recruiters that contact me also seem to be getting more desperate! Good times.
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One recruiter recently wrote me a poem. I wish I was kidding.
Seems it's hard to find security people with 15 years of experience and a background in finance auditing and law...
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Did the recruiter write it or ChapGPT?
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It was very bad, very poor on the meter, not exactly inspired and fairly formulaic and generally an embarrassment for any intelligent person.
So I'm fairly sure it was the recruiter himself.
outrageous consumer lending rates? (Score:4)
Even with consumer usury rates at all-time highs, it's amazing that Citi isn't showing more income. Sad for the folks getting laid off but the CEO has to get her bonus by driving up the stock price however she thinks she can do it.
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Even with consumer usury rates at all-time highs, it's amazing that Citi isn't showing more income. Sad for the folks getting laid off but the CEO has to get her bonus by driving up the stock price however she thinks she can do it.
That's the problem. Companies become too big to grow. A small company can grow easily. Add more branches. Buy other small banks. But a big company can't do that. Their only way to grow is through organic growth, which at a certain scale means adding customers at a rate proportional to the birth rate plus the immigration rate. Wall Street cares about growth, and growth is impossible, so big companies start doing stupider and stupider things to try to cut costs in an effort to fake growth, resulting in
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Sad for the folks getting laid off but the CEO has to get her bonus by driving up the stock price however she thinks she can do it.
The CEO should be fired for other reasons. After getting rid of 20k employees Citigroup will still have a higher employee count than they had in January 2023. The issue isn't that they are firing people now, it's that they hired like mad in the first place.
Less than 10% (Score:2)
Citigroup apparently has 240 000 employees. So 20k isn't all that spectacular in comparsion.
Duly noted (Score:2)
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cuz they took our jerbs
we created the monster (Score:1)
Gotta keep the stock price up (Score:1)
Being laid off is an opportunity - sometimes (Score:2)
The first time I received 6 months severance pay and had a new job one week later.
The second time, the severance pay I received enabled me to retire.
The key thing in life is to ensure that you have marketable skills, so a layoff is merely an unexpected bonus.