Citigroup to Lay Off 20,000 Employees Following Worst Quarterly Loss in 15 Years
Citigroup is set to trim its workforce by 20,000 employees over the next two years, according to CFO Mark Mason, following a dismal fourth quarter in 2023 where the bank reported a net loss of $1.8 billion, its worst in 15 years. The bank anticipates that this reduction in headcount will yield long-term savings of $2.5 billion.
While this move is expected to enhance the bank's financial position, it will undoubtedly have an impact on employee morale. However, Citigroup remains committed to its strategic goals and expects 2024 to mark a turning point. The bank also plans to shed 40,000 employees from its Mexican retail unit through an IPO, reducing its overall headcount to approximately 180,000 from 240,000.
WHY IS THIS IMPORTANT FOR MY INDUSTRY?
When a heavyweight like Citigroup stumbles, it's a signal the economy might be hitting some bumps. That can shake up how Americans spend, where businesses stash their on-hand cash, and how much they rely on shipping and delivery.
Citigroup's hiccups might also mess with how investors perceive the landscape, and that could sway their decisions when it comes to logistics stocks and where they invest. When the financial world gets unstable, the stock markets become a rollercoaster.
🔥 OUR HOT TAKE?
Some might say that Citigroup's layoffs and financial hiccups are just how the cookie crumbles in the business world. The big shots often enact the whole makeover and belt-tightening routine to stay in the game and keep up with the market's frequent twists and turns.
Huge money houses like Citigroup have a lot of say in different parts of the economy, like logistics and cash flow for supply chains. Shrinking down might be a way to loosen their grip on these fields and give smaller, creative players a better shot.
But hey, not everyone's on board with this idea. It doesn't necessarily consider how these big layoffs can hit workers and communities hard. It's a tug-of-war between the pros and cons, and we've got to weigh both sides and think about what it means for the whole economic picture.
Over the past few weeks, the freight and logistics industry has witnessed significant layoffs across several states including Florida, Georgia, Illinois, Michigan, and Texas.