Goldman Sachs has decided not to proceed with a second round of broad performance-based job cuts this year, following a stronger than expected recovery in its investment banking division, according to the Financial Times.

The Wall Street bank, which employs approximately 46,000 people, had previously considered further staff reductions in September if business conditions remained challenging. However, a rise in investment banking fees and client engagement, alongside continued strength in its trading division, have prompted the bank to hold off on additional lay-offs, the paper reported, citing people familiar with the matter.

Goldman Sachs had already reduced its workforce earlier in the year as part of its annual review process to manage expenses and staff performance. The initial cuts affected a low, single-digit percentage of employees. The prospect of further reductions had remained open, especially in the wake of the Trump administration’s introduction of new tariffs, which had initially dampened optimism about corporate dealmaking.

The bank’s staffing plans are still subject to change if economic conditions worsen, according to sources cited by the Financial Times. Goldman Sachs declined to comment on the decision.

Annual performance-based job cuts, referred to internally as a “strategic resource assessment”, are a regular occurrence at Goldman Sachs and across Wall Street. The scale and frequency of these assessments are often tied to the bank’s outlook, as management seeks to balance operational needs with cost control.

This decision comes after a turbulent year for Wall Street. While the start of 2025 was marked by expectations that deregulation and consolidation would boost corporate dealmaking, those hopes were tempered in April by the impact of new trade policies from the White House.

However, recent financial results have been encouraging. In the second quarter, investment banking fees at Goldman Sachs rose by more than 25 per cent compared to the same period last year, representing the largest increase among its peers. Across the industry, these fees are up about 2 per cent year-on-year, totalling around $67 billion, according to data from the London Stock Exchange Group.

Trading has also remained a key revenue driver for Goldman Sachs in 2025, with the bank benefiting from elevated volatility in equity and fixed income markets.

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