Blackrock set for layoffs as asset management industry adjusts to downturn
Blackrock is set to cut around three per cent of its global workforce this year as it adjusts to shifts in the global asset management sector.
The planned layoffs at the world’s biggest money manager, which runs around $9.1 trillion for clients, would amount to around 600 staff based on its 19,800 headcount at the end of December 2022, the last time the firm updated its staff numbers.
A source told Reuters that no single team will be the focus of the cuts, with the firm adding that it expects to swell its headcount by the end of 2024.
Blackrock’s scale has helped it weather the headwinds that have buffeted money managers this year. The firm has climbed around five per cent in value but is well behind the 22 per cent gain of the flagship US S&P 500 index.
Boss Larry Fink said in October the firm is on the hunt for deals this year to bolster its growth. Money managers globally have been through a period of consolidation in the past year as smaller firms grapple with a crisis in investor confidence and heavy outflows.
Rapid rate hikes by central banks have also boosted the allure of cash and dented the appeal of asset managers in the past 12 months.
At Blackrock’s third quarter results, Fink said for the “first time in nearly two decades, clients are earning a real return in cash” and were waiting for more policy and market certainty before “re-risking”.
“This dynamic weighed on the industry and BlackRock’s third-quarter flows,” he added.
The firm is set to announce its fourth-quarter results on Friday.