AI starting to affect banking…

First it was the tech industry warning that headcount will decrease due to AI. Now the banks are giving the same type of warning: their profits will increase will headcount will decline.

Here’s the link to the article on JP Morgan’s and Goldman Sach’s announcement of reconfiguring the companies in light of the capabilities of the AI.

My impression of the article is that there won’t be massive layoffs but instead a quiet reduction in hiring. They will make an effort to retrain and redirect the affected employees before doing a layoff. Towards the end of the article, you get where the pressure is coming from: shareholders.

Teaser quotes

As a teaser to the article here are some quotes:

“JPMorgan said Tuesday in its third=quarter earnings report said that while profit jumped 12% from a year earlier to $14.4 billion, head count rose just by 1%.”

Hugh Son, “Big banks like JPMorgan Chase and Goldman Sachs are already using AI to hire fewer people”, CNBC, October 15, 2025.

“Goldman is coming off a quarter where profit surged 37% to $4.1 billion.”

Hugh Son, “Big banks like JPMorgan Chase and Goldman Sachs are already using AI to hire fewer people”, CNBC, October 15, 2025.

The banks had a very healthy quarter.

Now here’s some indications of pressures:

“Companies across sectors have become more blunt this year about the possible impacts of AI on employees as the technology’s underlying models become more capable and as investors reward businesses seen as ahead on AI.” (Italics mine.)

Hugh Son, “Big banks like JPMorgan Chase and Goldman Sachs are already using AI to hire fewer people”, CNBC, October 15, 2025.

“…this process is part of the long-term dynamism our shareholders, clients, and people expect of Goldman Sachs…” (Italics mine.)

Hugh Son, “Big banks like JPMorgan Chase and Goldman Sachs are already using AI to hire fewer people”, CNBC, October 15, 2025.

So, what do we do?

I don’t really have an answer but here are some ideas:

• Get familiar with AI and figure out what it can and cannot do.
• Level up your skills to address what AI does not address at work.
• For FP&A folks, if your superpower had been an Excel superuser, the AI agent may wipe out that advantage.
• Still use that AI agent but travel to where the AI agent isn’t addressing.
• Maybe address the clarity of the spreadsheet and its storytelling.
• Think of what questions you should have been asking that you did not before due to extensive manual activities. The AI agent may be able to address those questions that you couldn’t before due to complicated formulas.
• Again, for FP&A, think about foresight, think about agency.

Good luck out there!

Other concerns – the weather

Pending high unemployment due to chief executives’ plans to restructure organizations and shrink headcount is one set of concerns, but there are others striking us at the same time.

Climate change: Right now I’m looking out at the Atlantic and Caribbean and there is one or two tropical waves moving west from Africa. My one weatherman who does advance prognostication says one of those waves might turn out to be the one to worry about.

I don’t want to jinx this but so far this summer the named storms were either piddly tropical storms or Cat 4 or 5 hurricanes. Either a nothing burger or out and out dangerous storm. Fortunately, those hurricanes – and they were a beast – raged across the Atlantic without ever hitting land.

We also had a couple of other good fortunes: dry air or dust coming off of Africa or wind shear. Both of those elements tend to weaken tropical storms (which probably is why those piddly storms were piddly).

We did not have any tropical waves enter the Caribbean or the gulf this summer, which is unusual.

We may be running out of luck now and the waters out there are extremely warm. My fear is once the tropical wave enters the exceedingly warm Caribbean, the storm will rapidly intensify into a Cat 4 or 5. We have had no Cat 1, 2 or 3. It was either piddly (relatively) or a raging monstrous Cat 4/5.

So, now I’m monitoring the weather out there.

Other concerns – violence

So, today was No Kings Day and at first glance it was peaceful.

I was afraid that it could get violent due to the mood out there, but so far, people have restrained themselves.

I think that the peacefulness was due to a few factors:

• The organizers prepared for the protest by having de-escalation training.
• The organizers also stressed the importance of maintaining the peace if the people did not want to arouse military action.
• Somehow the more volatile elements either stayed away or constrained themselves.
• The people who attended appeared to be composed of elderly and families with children, which might be constraining the more volatile elements.

I’m just thankful that people are keeping their heads on their shoulders.

The next time – if there is a next time – will be after tariff inflation, food stamp cuts, healthcare insurance premium rises, and general increasing hardships will be in full force. We could be seeing more of these hardships affecting more families and may see increasing starvation. I don’t know – the predictions have been pretty dire.

As we go further into this political cycle, it gets scarier and scarier as I watch the people’s mood.