The job cuts, which one source calls “streamlining”, will be evenly spread across regions and represent 3% of the world’s largest money manager’s entire workforce. They will be announced in the coming weeks, reported Bloomberg.
In an internal memo to employees the firm said that the cuts have not been finalised yet, Bloomberg said. The redundancies will be made to free up resources to invest in opportunities in other areas, while BlackRock will continue to hire in what could be called a “re-alignment” process, Portfolio Adviser has learned.
According to one of Bloomberg’s unnamed sources, BlackRock will “continue to invest and hire in key areas and expects to end the year with a higher headcount.”
President Rob Kapito and COO Rob Goldstein state in the US memo that their firm needs to “(…) focus resources on strategic priorities and create new opportunities for our strongest employees.”
In January, BlackRock chief executive Laurence Fink told the FT that the market swings at the start of this year are likely to result in job losses this quarter and next, and that the market volatility “puts a negativity across the economy, a negativity to every CEO looking at his or her stock price, a negativity about business.”
The last time BlackRock, which manages $4.7trn of assets, cut jobs on a similar scale was in 2013 when it let 300 people go, but it actually did end the year with a higher headcount. Since then, the company’s headcount has increased by about 2,500.
The fund giant is not alone in cutting costs – State Street announced in October it would be firing 600 employees globally to accelerate cost reductions, while foreseeing 7,000 job cuts by 2020, and investment firm Franklin Resources Inc cut 1% of global staff in February.
BlackRock declined to comment.
