Barclays cuts 5,000 jobs: AI changes the equation for banking work

It is no longer a conference forecast. On Thursday, Barclays, presenting third quarter results, put in writing what many feared: about 5,000 fewer jobs by the end of 2026. This is 5% of a workforce that at the end of 2025 numbered 93,000 people. One thousand exits have already occurred in the first half, the other 4,000 will arrive by December. The bank speaks of "organisational simplification" and a technological change "driven by artificial intelligence".

It especially hits those who foot the bill. About 60% of the cuts concern support functions, "including fewer developers, because AI makes our staff more productive," explained the CFO Anna Cross. So not only cashiers, but also those who write code. Barclays expects to save over £1.1 billion in 2027, against about £600 million restructuring costs this year.

Barclays is not an isolated case, but the latest in a series. In May, Standard Chartered announced over 7,000 job cuts by 2030, 15% of corporate functions. CEO Bill Winters spoke candidly of replacing "low-value human capital."

HSBC, according to Bloomberg, is considering up to 20,000 exits worldwide, about 10% of the workforce. In the UK it is already cutting 70% of financial advisors in the wealth division. In Germany Commerzbank has planned 3,000 cuts. In the Netherlands ABN Amro aims to reduce staff by one-fifth by 2028, mainly through automation. In the USA, Goldman Sachs and Morgan Stanley have already reduced staff by slowing junior analyst hiring.

So, how many jobs are at risk? The most cited estimates are two. Bloomberg Intelligence interviewed 93 technology leaders from major banks and calculates up to 200,000 fewer jobs worldwide in three to five years. Morgan Stanley's forecast for Europe is heavier. In January, it spoke of over 200,000 jobs lost by 2030, 10% of the 2.12 million employees of the continent's 35 largest institutions. In May, it doubled the estimate: up to 20%, about 400,000 workers.

Where are the cuts concentrated? In the roles the customer does not see: back office and middle office, risk management, compliance, anti-money laundering, customer verifications, support. “Any job made up of repetitive and routine tasks is at risk,” sums up Bloomberg Intelligence analyst Tomasz Noetzel.

And geography? The epicentre is London, but the wave goes beyond the Channel. Barclays focuses savings on its UK retail bank, but part of that back office is in India, where according to the BBC a significant share of the job cuts will fall. Standard Chartered will mainly hit operational centres in Chennai and Bangalore, Kuala Lumpur and Warsaw. It is the paradox of globalisation: activities relocated abroad to save costs are the first to be automated. In France, Germany, the Netherlands and Spain, instead, factory councils and collective agreements slow layoffs and encourage retirements and voluntary departures.

And Italy? Since 2010, the sector has already lost about 63,000 employees, dropping from 321,000 to 258,000, according to a Fabi elaboration on ECB data. So far, however, the decline has mainly been due to mergers and branch closures, managed with the Solidarity Fund and early retirements. 73% of banks indicate AI among their technological priorities, according to Abi. The union warns that artificial intelligence “must not become an excuse to cut jobs without managing the transition.”

One question remains: how much is really the fault of AI? Barclays CEO C.S. Venkatakrishnan himself admits that so far much of the efficiency gains come from technology and process review. For now AI is “the cherry on the cake,” as he himself said. But for those working in banks, the cake is already shrinking.