BlackRock to Lay Off 500 Employees in First Reduction Since 2019

BlackRock Inc. plans to lay off approximately 500 employees, or 2.5% of its global workforce. This comes after the asset manager experienced significant declines in equity and bond markets last year.
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"Given the current uncertainty, it is more important than ever that we stay ahead of changes in the market and focus on delivering for our clients," Chief Executive Officer Larry Fink and President Rob Kapito wrote in a staff memo on Wednesday.
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This is the first round of job cuts at BlackRock since 2019, but it will still leave the company with about 5% more employees than it had a year ago. BlackRock is set to report fourth-quarter results on Friday. At the end of September, the company had approximately 19,900 employees.
Firms on Wall Street are cutting back on hiring and reducing staff in light of the uncertain economy and the risk of a recession. Goldman Sachs Group Inc. is planning to eliminate around 3,200 jobs this week, including in its core trading and banking divisions.
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Inflation and interest rates have risen sharply in recent months, putting pressure on asset managers and markets. The S&P 500 index fell 19% last year, and shares of BlackRock have slid 6.5% so far this year. The stock slumped 23% in 2022.
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The firm, with $7.96 trillion of assets under management at the end of the third quarter, said it would reduce its workforce but didn't specify which businesses would be most affected. Fink and Kapito said in a memo that they would work to "manage expenses prudently" and invest in cost-effective ways.
The executives sought to emphasize the firm’s ability to take in new client money. Flows into its long-term investment funds increased significantly in the last year, and analysts believe they will continue to do so. This is a positive sign for the future of the company.
Fink and Kapito wrote that our breadth and resilience enable us to play offense when others are pulling back.