Morgan Stanley (MS) is planning to lay off about 2,000 employees in the coming weeks as part of a cost-cutting push. The reductions will affect around 2% to 3% of its workforce, but financial advisers will not be impacted.
This move aligns with a broader trend among major Wall Street banks. Recently, Goldman Sachs (GS) announced that it is letting go of 5% of its workforce. Meanwhile, JPMorgan (JPM) has cut approximately 1,000 jobs, and Bank of America (BAC) has eliminated 150 junior positions. These measures come as banks grapple with slower deal-making, rising costs, and economic uncertainty.
New CEO Cuts Jobs as Deals Slow and Tariffs Add Pressure
Morgan Stanley is making its first big job cuts under CEO Ted Pick, who took over in January 2024. The bank is reducing staff based on performance and long-term plans, rather than reacting to short-term market changes like inflation and tariffs.
This decision comes as the investment banking industry faces a tough deal-making environment. Banks had expected more deals after Donald Trump won the 2024 election, but activity did not pick up as hoped. According to a McKinsey report, M&A deal value in the Americas rose to $1.8 trillion in 2024, but deal volume grew just 9%. With fewer deals happening, banks are cutting costs by laying off some employees.
Still, Morgan Stanley is hiring in key investment banking areas. Co-President Dan Simkowitz said at a Tuesday conference that M&A and new stock offerings are “on pause.” However, he noted the bank is bringing in senior talent, expecting a rebound in capital markets.
Is MS Stock a Buy?
Morgan Stanley stock has a consensus Moderate Buy rating among 15 Wall Street analysts. That rating is based on five Buy and 10 Hold recommendations assigned in the last three months. The average MS price target of $143.80 implies 21.75% upside potential from current levels.
Read more analyst ratings on MS stock
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