Barclays Plans Job Cuts Amid AI Advancements
On Thursday, Barclays CEO C.S. Venkatakrishnan referred to artificial intelligence as the “icing on the cake” while announcing the bank’s intention to cut around 5,000 jobs by the end of the year.
This reduction accounts for roughly 5% of Barclays’ global workforce, with 1,000 positions already eliminated and an additional 4,000 projected to be cut by the end of 2026. This announcement coincided with third-quarter financial results that revealed a 12% increase in pretax profits, reaching about $3.1 billion. However, executives mentioned that further cost-saving measures would be implemented as the bank modernizes its technology.
Venkatakrishnan clarified that while AI plays a role in the organizational overhaul, it isn’t the sole factor behind the workforce changes. He emphasized the need for substantial infrastructure development to truly reap the benefits of AI. The efficiency improvements for the company are largely due to years of investments aimed at modernizing systems and streamlining operations.
Interestingly, around 60% of the anticipated job cuts will impact support roles, including software developers, as the remaining workforce leverages AI to manage a heavier workload, according to reports.
Barclays is also projecting that these cost-cutting strategies could yield about $1.5 billion in further savings by 2027. Additionally, the bank has launched a £500 million share buyback initiative, which raises its total shareholder returns for the year to £2.8 billion.
The planned layoffs reflect a broader trend among major companies adopting automation to lower labor costs. This shift has sparked concerns regarding the future of jobs traditionally held by humans. Critics, particularly in the labor sector, are highlighting the need for companies to focus on retraining employees instead of simply cutting roles.
Sharon Graham, the general secretary of the Unite union, criticized Barclays for allegedly using AI as a pretext to eliminate jobs, thus disregarding the commitment and sacrifices of its long-serving employees.
