A 225-page report by Wells Fargo predicts a massive reduction for banking jobs.
A 225-page report by Wells Fargo outlines how advancements in technology can lead up to 10% of banking jobs to be cut in the next decade.
According to Business Insider, Wells Fargo’s 225-page report outlines how technology could impact the US banking industry, including how AI could reduce mortgage processing costs by 10% to 20%, while the use of big data and cloud computing could yield significant savings.
The banking industry spends $150 billion annually on tech — higher than any other industry in the US — which should ultimately lead to lower personnel costs. Major banks’ tech budgets are at a high: JPMorgan Chase, Bank of America, and Wells Fargo had tech budgets of $11.5 billion, $10 billion, and $9 billion, respectively — allowing them to roll out advanced digital features that help attract customers while cutting personnel costs.
A change is yet to come
Wells Fargo isn’t the first to predict that tech advancements in banking will have a major impact on banking employees’ trajectory. McKinsey reported earlier this year that the headcount of front-office workers will drop by almost a third with the rise of robots. Meanwhile, R. Martin Chavez, former Global Co-Head of the Securities Division of Goldman Sachs, says that all traders will soon need coding skills to succeed on Wall Street.
According to Bloomberg, Banks are spending billions in the race to utilize the latest technologies in everything from capital markets to retail banking. JPMorgan Chase & Co., the biggest U.S. bank, sets aside more than $10 billion to spend on technology each year and has even gone so far as to call itself a technology company.