Morgan Stanley could be the next Wall Street firm to announce a major round of layoffs, alongside Goldman Sachs, with numbers ranging as high as thousands of jobs.  FOX Business's Charlie Gasparino, quoting someone with direct knowledge, reports that this possible new round of job cuts could go well beyond the pruning of low-producing brokers the firm has already announced.

While Morgan officials confirmed plans to cut some 300 brokers, they remain circumspect about additional possible layoffs, particularly if the current Wall Street profit drought persists.  An MS spokesperson wouldn't deny that Morgan is drawing up plans for a sweeping new round of layoffs if business conditions don’t improve, noting the firm is "constantly evaluating the market conditions to ensure we are right sized.”

'BB' (Beyond Brokers) Plans.   Unforturnately, in the event of a prolonged sag in profits, any new round of job cuts would be large and go beyond brokers - including traders and possibly investment bankers.  [C-I Note:  Oh really?  And what about compliance, legal and other infrastructure types?  As if these departments wouldn't be targeted for significant job and/or expense cuts.]

With a current workforce of some 60,000, a 5% reduction in staff would amount to 3,000 lost jobs.  In recent weeks many of the major Wall Street firms have announced modest job cuts as a combination of lower volume of trades, declining customer orders for stocks and other investments and the costs of new regulations have squeezed profits. 

Goldman Sachs has already confirmed ... the biggest cost savings plan of all the firms on Wall Street, aiming to cut $1 billion in expenses before the end of the year.  Such a large-scale cost cut inevitably would entail (thousands of) layoffs.  As first reported by FOX Business, Goldman would also look to move jobs to low-cost areas overseas - e.g., hiring 1,000 new people in its Singapore office.  Goldman, with around 35,000 employees, is half the size of Morgan, which combines an investment bank and Wall Street’s largest brokerage sales force where 18,000 financial advisers sell stocks, bonds and mutual funds to small investors.

For further details, go to:   [Fox Business, 7/13/11]