Bank of America's plans to trim its workforce are nothing new, but the surprising thing about Tuesday's news of 2,000 layoffs in addition to the 30,000 the bank already announced is who the new cuts target: The bank's own top 1 percent of workers. Coming on a day of populist protests that Occupy Wall Street sees as its resurgence, that's pretty deliciously ironic.
The cuts come in the "investment banking, commercial banking and non-U.S. wealth-management units," The Wall Street Journal's Dan Fitzpatrick and Dana Cimilluca report. They target "the high-earning employees whose efforts helped Merrill Lynch account for the bulk of Bank of America's profit since the financial crisis." Actually, the 2,000 workers account for just 0.7 percent of the bank's 278,000 workers, but they're a very expensive 0.7 percent.
As the Journal's Fitzpatrick and Cimilluca note, the bank is desperate to show investors it can curb expenses. It's reorganizing itself to what sounds like a sort of zone defense, where investment bankers can be more flexible and less industry-specific: "One structural shift being planned will pool junior investment-banking employees across different industry sectors so the younger bankers can be routed to whatever area is most in demand at that moment, said people familiar with the situation." That translates to fewer high-paid people handling investments in a way the bank hopes will keep dollars rolling in with fewer bonus checks rolling out.