Replacing highly-compensated managing directors with less highly-compensated child laborers only goes so far in cutting costs. Next on Goldman's chopping block? Rooms at the Ritz, business class, and that vacationwork trip to Dubai you were planning.
Goldman Sachs Group Inc. is embarking on its biggest cost-cutting push in years as it tries to weather a slump in trading and dealmaking, according to two people with knowledge of the effort. The firm, already expected to report a steep drop in expenses for the first quarter, recently began dismissing more support staff and is increasingly rejecting bankers’ spending on airfare, hotels and entertainment unless it directly serves clients, the people said. For example, the company cut technology workers in London this week, one person said, and some employees in Europe aren’t being permitted to take once-routine trips to other offices in the region, said another. Additional cuts are likely./small>
And hey, they can always fire more people and ask those who remain to use the buddy system re: desks and chairs.
At a conference in February, Blankfein reassured investors that he’s keeping an “eagle eye” on expenses and that the firm had more flexibility to reduce them. “We can do a lot more on the cost side if we have to,” he said. “We can always do more. I mean, necessity really is the mother of invention in this case, especially when you have to deliver a return.”