A recent round of State Street layoffs will have the company reducing its workforce by 6%.
These layoffs will see State Street (NYSE:STT) reducing its number of employees by 1,500. The company notes that these layoffs will take place at high cost locations. It also says that the layoffs are part of its effort to better focus on automation and standardization.
It isn’t just normal employees that are being caught up in the State Street layoffs. In addition to the 1,500 layoffs, the company will also be reducing its senior managers. This will have it cutting its senior management team by 15%. This will be through delayering and aligning global organizations.
The goal of the State Street layoffs is for the company to reducing its operating costs. It says that these efforts, as well as others, will result in $350 million in savings for 2019.
The company does note that its fourth quarter of 2018 expenses include a repositioning charge of $223 million due to the State Street layoffs. This includes $198 million of compensation and employee benefits, as well as $25 million in occupancy costs.
“While we have made progress on our technology transformation, much remains to be done and we are not satisfied with our recent performance,” Ronald O’Hanley, President and CEO of State Street, said in a statement. “Structural costs are still too high and our automation efforts have not moved fast enough.”
STT stock started off strong on Friday, but is now only up slightly as of noon.
As of this writing, William White did not hold a position in any of the aforementioned securities.