This plan was actually made before the recent market tumult and is aimed to reduce costs at the company with about 80,000 employees and a low attrition rate, according to a Bloomberg report.

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The cuts will be across the firm, but will not affect its roughly 15,000 financial advisers, according to the report, which added that some of the cuts are tied to performance, some are due to changes in the places where the firm bases some of its workers, and a small portion is due to the impact of artificial intelligence (AI) and automation inside the firm.

The AI impact will be driving an increasing portion of job reductions in the coming years as well, according to the report.

US President Donald Trump's tariffs and policy changes may also have played a role in the clients of these firms lessening their banking activities.

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The cuts also comes amid a series of workforce reductions across Wall Street as bosses navigate an uncertain economic outlook.

For instance, rival Goldman Sachs recently brought forward a plan to cut 3% to 5% of staff this spring.

The report quoted Morgan Stanley's Co-President Dan Simkowitz as having said on Tuesday that Merger and Acquisition (M&A) announcements and new equity issuances are “certainly on pause.”

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The bank's shares are also down 6% so far this year, making it the worst performing stock among major US banks.

However, Morgan Stanley is still “adding real headcount” at senior levels of investment banking, anticipating a capital-markets recovery, according to the report.

Pick had taken over as CEO at the start of 2024, and then got the chairman title at the beginning of this year, according to the report which added that he has however, mostly stuck to the strategy of his predecessor, James Gorman, who ran the firm for over a decade.