Wall Street, the global financial center, may cull nearly 200,000 jobs worldwide in the next three to five years thanks to the rise of artificial intelligence, Bloomberg Intelligence reports. This prediction is based on a survey of 93 CIOs and CTOs at major banks, including Citigroup and Goldman Sachs.
“Back office, middle office and operations” roles will likely be the most vulnerable. AI could also boost bank profits by as much as 17% by 2027, the report predicts.
Chief information and technology officers that surveyed for BI indicated on average they expect a net 3% of their workforce to be cut, according to a report published Thursday.
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The intersection of banking and AI is driving significant changes on Wall Street, leading to massive layoffs in the financial industry. Advancements in AI and automation are enabling financial institutions to streamline operations, reduce costs, and improve efficiency.
AI-powered systems are taking over tasks traditionally performed by human workers, such as data analysis, trading, customer service, and risk assessment.
As a result, many roles that once required human oversight, such as junior traders, analysts, and back-office staff, are being replaced by sophisticated algorithms and machine learning models.
Banks and financial firms are using AI to process vast amounts of data at speeds far beyond human capabilities, making real-time decisions in markets and minimizing human error. These advancements are especially evident in investment banking and asset management, where AI-driven platforms can analyze trends, predict market movements, and execute trades autonomously.
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While these innovations have led to greater profitability for many firms, they have also triggered widespread job cuts. Thousands of employees in areas like customer support, accounting, and trading are being laid off as AI takes over their functions. This shift is reshaping the financial sector, prompting a reevaluation of the workforce’s role in an increasingly automated industry.