Profits soar, jobs disappear: Barclays plans to slash 5% of workforce

A £2.3 billion quarterly profit hasn't stopped Barclays from planning to eliminate around 5,000 jobs, highlighting growing pressure on employees as major financial institutions seek to control costs and overhaul operations through technology.

The British banking giant plans to cut its workforce by about 5% this year, aiming to rein in rising costs and improve revenue. Around 1,000 positions have already been eliminated, with a further 4,000 job cuts planned by the end of 2026, according to the reports.

The planned reduction comes despite Barclays reporting a £2.3 billion third-quarter profit, a significant improvement on its performance in the corresponding period last year.

However, the bank's strong overall earnings have not erased concerns about weaknesses in some of its core businesses.

Its fixed-income trading division, traditionally one of the bank's strengths, has performed more weakly, weighing on its investment banking results.

Barclays CEO CS Venkatakrishnan has voiced disappointment over the trading performance, saying, ‘I am disappointed.’

The bank's share price has also come under pressure. Despite gains in previous years, its shares have declined by 14% this year. Higher interest rates previously improved the bank's profitability.

Software developers and support functions face cuts

The restructuring is expected to extend beyond conventional banking roles. According to a New York Times report, a presentation Barclays released this week indicated that around 60% of the planned job cuts would affect support functions, including software developers.

The development underscores how workforce restructuring is reaching beyond the technology sector, where companies have increasingly turned to automation and artificial intelligence to streamline operations.

Venkatakrishnan has said the job reductions are part of a broader effort to simplify and strengthen the bank's business through technology investments. However, he has also clarified that technological change is not the only factor driving the restructuring.

Artificial intelligence is expected to play a more significant role in the banking industry, and the Barclays chief acknowledged its growing importance.

‘AI has an important role to play, and it could play an even more important role in the future,’ he said.

The planned layoffs therefore reflect a combination of cost pressures, business restructuring and technological transformation.

For employees, the development offers a stark reminder that even profitable financial institutions may pursue significant workforce reductions as they seek to improve efficiency and prepare for a technology-driven future.