BlackRock is planning to cut 500 jobs citing ‘uncertainty around us’

“The uncertainty around us makes it more important than ever that we stay ahead of changes in the market and focus on delivering to our clients,” Chief Executive Officer Larry Fink and President Rob Kapito said Wednesday in a staff memo seen by Bloomberg.

This is the first round of job cuts at New York-based BlackRock since 2019, and will still leave the headcount about 5% higher than a year ago. The company, which will report fourth-quarter results on Friday, had about 19,900 employees at the end of September.

Companies across Wall Street are holding back plans to hire and cut staff amid economic uncertainty and the threat of a recession. Goldman Sachs Group Inc began one of its biggest rounds of job cuts, with plans to eliminate about 3,200 positions this week, including from its core trading and banking units.

Declining inflation and rising interest rates have weighed on asset managers and markets, with the S&P 500 falling 19% last year. Shares of BlackRock slid 0.3% to $754.94 at 12:47 pm in New York, trimming the gain since the beginning of the year to 6.5%. Shares are down 23% in 2022.

The company, with $7.96 trillion in assets under management at the end of the third quarter, did not specify which businesses would be most affected by the job cuts. Fink, 70, and Kapito, 64, said in a memo that they will be able to “manage expenses prudently” and invest in cost-effective ways.

The executives sought to emphasize the company’s ability to take new clients’ money. Flows into long-term investment funds increased by $250 billion over the first nine months of last year, and analysts surveyed by Bloomberg predicted an additional $116 billion in the fourth quarter.

Fink and Kapito wrote, “Our presence and resilience allow us to attack when others retreat.”