While the mainstream media mavens promote the theme of economic recovery, the Obama economy’s layoff machine continues to put numbers on the board. This week American Express and Morgan Stanley announced major reductions in force (The Blaze). Roughly 5,400 positions will be cut at American Express, while Morgan Stanley expects to slash 1600 positions, half of which will be in its prestigious investment banking unit.
The AmEx cuts represent 8.5% of the credit card giant’s workforce (The Wall Street Journal). Its travel-focused business has encountered increased competition from online reservations channels, while the company’s recent marketing strategy has been problematic. AmEx used to issue credit cards primarily to affluent customers with good credit profiles. But during the last decade it expanded into the broader retail market and has been hammered by the financial crisis of 2008-2009 and the lingering malaise of today.
It appears that the employment situation in the financial services sector is likely to remain challenging for the forseeable future, despite massive government intervention and rock-bottom interest rates.
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