By AnnaMaria Andriotis

Goldman Sachs is preparing its annual round of layoffs, this time with a focus on its vice presidents.

Goldman CEO David Solomon has told senior executives that the firm hired too many vice presidents in recent years in relation to its overall hiring, according to people familiar with the matter. The cuts are intended to improve the firm's efficiency, which Solomon has made a priority.

Hints have been given to vice presidents who are likely to get cut both in the form of poor reviews late last year and small bonuses earlier this year. Employees who left as a result will be counted toward the firm's total goal for layoffs.

About 3% to 5% of the firm's workforce is expected to be cut. Goldman's overall head count, which ended 2024 at 46,500, is expected to remain flat this year when factoring in hiring.

The cuts are part of Goldman's annual culling of low performers that executives say is likely to occur in the spring this year, instead of September when it's typically been done in recent years. That would help boost the firm's performance earlier in the year.

"Like other banks, this is part of our normal, annual talent management process. We don't comment on the specifics in any given year," said a Goldman spokeswoman.

Solomon has been vocal about the firm's focus on improving efficiency. In January, he said on an earnings call that the bank had made progress but that "we believe there are significant opportunities to drive further efficiencies." He added that Goldman has created a three-year program that will help manage its expenses, among other things.

Goldman's stock is up 48% over the past year, according to FactSet. The gains partly reflect the firm's narrowing its strategic focus to two main divisions: investment banking and markets, as well as asset and wealth management.

Longer term, Goldman's investments in artificial intelligence are expected to eventually contribute to job cuts, mostly in operations and other back office roles. Goldman recently rolled out an artificial-intelligence assistant to bankers in what is expected to be the first stage of a larger rollout.

Write to AnnaMaria Andriotis at annamaria.andriotis@wsj.com

(END) Dow Jones Newswires

March 04, 2025 17:39 ET (22:39 GMT)

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