What Should JPMorgan Chase & Co (NYSE:JPM) Learn From Goldman Sachs Group Inc (NYSE:GS)?
Goldman Sachs Group Inc (NYSE:GS) hiked its dividend and reported a profit that was surprisingly better-than-expected. But investors were not too impressed, even as they gave these factors a cursory glance and focused on the company’s revenues that were almost in a free-fall dive, in the Q3. Goldman Sachs Group Inc (NYSE:GS)’s revenues dropped 22% from the Q2 and 20% in comparison to the previous year. Lloyd Blankfein, the company Chief Executive Officer said that these results were a reflection of a period of a slowdown in client activity and that they are sure things will improve in the Q4.
Average compensation cuts
Currently, Blankfein is the chairman of the trade group, the Financial Services Forum. This group represents bank chiefs and he has been very vocal about the shutdown and the chaos at Washington over the last one month. The company has been a little on the downtrend in terms of revenue lately but has not resorted to the normal cost-cutting measures like cutting headcount. However, Goldman Sachs Group Inc (NYSE:GS) did axe the overall compensation by around 5% in the 1st nine months of this year, in comparison with the same period of last year. It was these cost cuts that have been the main profit-drivers in the quarter. In the first 3 quarters, there was a dip of around $319,755 in the average-compensation for each employee.
On the other hand, another large banking institution, JPMorgan Chase & Co (NYSE:JPM) decided to wield the axe on employees. So far in 2013, it has become infamous for being the biggest job cutter and tops the list of the top-10 publicly traded companies in the United States.
Marketwatch compiled a list in which it states that JPMorgan Chase & Co (NYSE:JPM) cut the most jobs in 2013 and has plans of showing 19,000 employees, the door. Customers are veering towards self-service technologies and the company has announced that it will cutting down 4,000 jobs at the consumer-banking division. Apart from this, JPMorgan Chase & Co (NYSE:JPM) also announced that it intends to cut down 15,000 mortgage workers.