Wells Fargo CEO Says More Job Cuts Coming at the Bank as AI Prompts 'Efficiency' (charlotteobserver.com) 39
Wells Fargo expects more job cuts and higher severance costs in this quarter that ends in three weeks, bank CEO and President Charlie Scharf said Tuesday at an investors conference in New York. He's also betting on AI to drive efficiency and, eventually, further workforce reduction.From a report: "As we've gone through the budgeting process, and even pre AI, we do expect to have less people as we go into next year," Scharf said at the Goldman Sachs Financial Services Conference in New York City.
"We'll likely have more severance in the fourth quarter." The fourth quarter runs Oct. 1 through Dec. 31 for the San Francisco-basaed bank. Wells Fargo already has shrunk from 275,000 employees to about 210,000 since Scharf joined the bank in 2019 -- about a 24% decrease. Its largest employee base remains in Charlotte, with about 27,000 workers.
"We'll likely have more severance in the fourth quarter." The fourth quarter runs Oct. 1 through Dec. 31 for the San Francisco-basaed bank. Wells Fargo already has shrunk from 275,000 employees to about 210,000 since Scharf joined the bank in 2019 -- about a 24% decrease. Its largest employee base remains in Charlotte, with about 27,000 workers.
Just a RIF? (Score:5, Insightful)
More and more I am wondering if these AI "initiatives" are just an excuse to reduce headcount and figure things out later, rather than an actual commitment.
Re: (Score:1)
Exactly. Check the SEC quarterly filing for the official guidance on AI adoption.
Re:Just a RIF? (Score:4, Funny)
More and more I am wondering if these AI "initiatives" are just an excuse to reduce headcount and figure things out later, rather than an actual commitment.
It's a bit of both. They really think AI will eat those jobs, and they're almost certainly right. It's just a matter of getting the timeline, and better to be early than late on big defining trends.
The glorified scripting that we're calling AI, along with other automation and robotics, is going to end entire categories of jobs, with nothing visibly in sight to replace them. Unless you can get governments to mandate make-work positions, there's really no way to stop the waves of layoffs that are coming.
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I recall reading that investment bankers pick stocks only marginally better than throwing darts at a dart board. Wells Fargo might have dead weight to cut, but I would hesitate to extrapolate that out to jobs where competency matters. That is where it the LLMs fail.
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Yes. They are. Your wondering is exactly correct - this is not an open question, AI is leading to a 0% reduction in headcount. It is just an excuse.
Re: Just a RIF? (Score:2)
Re: Just a RIF? (Score:2)
These days, the market is more trusting of the statement that better tools and processes require fewer employees to serve the same customers if you call that AI. If you get more of your customers to succeed in using your website or app to do what they need without having a human do anything for them individually, you don't need as many employees doing it. But the market doesn't want to hear that you can cut jobs because your website doesn't suck as much any more, so you say AI and they think you've done som
Re: (Score:2)
I'm pretty sure that they try to supplement what they can with AI, but then outsource the rest to low wage countries like India.
So, really, it a log like the early 2000's all over again, except that they have an AI boogey man to blame for the layoffs.
Re: (Score:1)
Couldn't shareholders sue their pants off for such a lie...if caught? Enough companies seem to be hiding slumps behind AI bs that the first successful legal team will have to skill to quickly slap the others.
Wells Fargo has been losing sales for a while now because their ghost-service-add-on scam gave them a bad reputation.
Re: (Score:2)
They were pretty wishy-washy about it and looking forward rather than saying "based on the performance of AI we need to get rid of all these superfulous positions."
Now that's a plan. (Score:5, Insightful)
Re:Now that's a plan. (Score:5, Insightful)
Amazing how execs are so valuable and unique that they can't be replaced by AI. I could see many millions saved for just a few of these dead weights.
Re: (Score:1)
PhbGPT
Re:Now that's a plan. (Score:5, Interesting)
So, SO true!
I'm constantly frustrated by the work situation I'm in now. The company keeps growing by acquisitions/partnerships and expanding its need for I.T. support. But there's zero interest in increasing head-count for the "rank and file" people doing the sysadmin or support work. Meanwhile, they've added 2 mangers for the department and both do little besides holding numerous meetings that feel like discovery sessions. They continually ask questions to try to understand pretty basic I.T. concepts and propose senseless changes (that we often have to reduce our level of daily support in order to work through for them). They literally reduce our productivity by being here!
Re: (Score:2)
You'd be amazed at how little effect firing execs actually has over the option of firing a bunch of low level worker bees .
Fire 1 exec for 12 Million salary
OR
Layoff 250 worker bees and save 25 million in salary expenses .
Nobody cares about workers at the level where these decisions are made.
Filed Under: "One is a tragedy, a million is a statistic" - Stalin (allegedly)
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Oh, but it's coming! There are right now a few companies recruiting executives in order to train AI for C-level work. Only the very top of the cream will be safe.
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The problem is, if they replaced some C-level execs with AI, the others would have to learn how to type prompts, and the company would discover that they don't know how to type.
Or if they're using voice-control, they'd find out that the AI needs you to actually specify what you want, and we'd find out that the execs don't know how to specify what they want.
Moe Layoffs, More AI BS (Score:1)
Wells Fargo is using AI as a fig leaf for layoffs. There is minimal AI adoption here. Check their quarterly SEC filing for official guidance.
If prices aren't efficient (Score:1)
Does "efficiency" mean not what you think it mesns, but "we get to do what we like, efficiently, without rationality stopping us"?
What effect does this new definition of "efficiency" have on mainstream economic theory? Is it time to put it in the dustbin of history?
Will be funny to see when the LLM hype collapses (Score:2)
And nobody can afford these things anymore and idiots like this one need to scramble to undo their bad ideas.
Re: Will be funny to see when the LLM hype collaps (Score:2)
After the crash, they'll have to do even more layoffs.
AIE (Score:5, Insightful)
Re: (Score:2)
Check the 3 year PMI at Trading Economics [tradingeconomics.com]. Not obvious that manufacturing activity in the US has done anything but increase over the last 12+ months.
You have different statistics? Of course, we know what statistics are, don't we? Even that site has conflicting data, because there is no single measure that tells us much. Bitterness is not an acceptable economic policy.
Never (Score:2)
Never trust anything banks, or bankers, tell you. It's all BS. Money has a way of twisting ethics and morals.
Bullsh*t (Score:2)
There is no way they are using AI for anything terribly important. I bet itâ(TM)s all projects around the periphery, with some showing promise, and many others not.
They must have a lot of extra employees.
Re: Bullsh*t (Score:1)
Remember when Wells Fargo had to pay a bribe^wfine for employees opening up fake accounts for customers? Do they do anything important?
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Massive wealth redistribution, the wealthy are hoarding money and buying assets, like housing and making them unaffordable for the rest.
I don't blame them, doesn't make them bad, greed is a natural force we have to manage.
I find it remarkable that poor people defend billionaires that make them poorer.
Any wealth is a product of the societies it was made in.
The billionaires need us, we don't need them.
Most accountants (Score:2)
don't do much and are still working out of excel (my sample size is 3 accountants two of which work in a big 4 company). It doesn't take much to be a financial wizard when you can start to automate stuff. AI is enabling accountants to be somewhat dangerous at coding.
Less bankers, less wankers (Score:2)
Not a problem.
Less bullshit jobs, shysters, parasites and degenerate gamblers is a good thing.
Though sadly they will probably be the one's left after the cull.
Shit always rolls down hill (Score:2)
Ever notice how AI is never on the table for upper management or c suite?
But those replaceable widgets are easy to replace.