Barclays to Cut 5,000 Jobs as Profits Rise Before the Budget
Barclays will shed about 5,000 roles, some 5% of its global workforce, after pre-tax profits rose 12% to £2.3bn in the third quarter. Its chief executive said an expected Budget tax rise on banks would be “bearable” but questioned the signal it sends. Roughly a thousand of the cuts have already been made.
Two things are being conflated in the coverage and both are worth straightening. The first is geography: the 5,000 is a global figure against a workforce of about 93,000, the cost-cutting is focused on the British retail bank, but a significant proportion of the actual job losses is expected to fall in India, where back-office functions are performed. These are not 5,000 British jobs. The second is artificial intelligence. The finance director tied about 60% of the reductions to support functions, “including fewer developers, as AI makes our people more productive”. But asked how many cuts were attributable to AI, the chief executive declined to give a number and put the bulk of the gains down to years of technology investment: “it is the icing on the cake — it’s not the cake”. On the Budget, six days away, his position was unusually candid: the bank makes about half its money outside Britain, so “this is not a question of a financial hit to us. It’s bearable. It is a question of proportion and it’s a question of market signaling.” Profits matched forecasts; group income of £7.4bn fell short of the £7.61bn expected.