European Banks AI Layoffs Could Reach 200,000

A new analysis by Morgan Stanley, reported by the Financial Times, suggests that over 200,000 banking jobs in Europe could vanish by 2030. This figure accounts for roughly 10% of the workforce across 35 major banks, who are increasingly investing in artificial intelligence (AI) and reducing their physical branch presence.

The areas most likely to see significant layoffs include back-office functions, risk management, and compliance. AI technologies have the potential to automate many tasks within these domains, drastically cutting the workforce needed. Interestingly, alongside these job losses, some banks anticipate that efficiency could increase by as much as 30% due to the integration of AI tools and practices.

Conor Hillery, Vice President for Europe, Middle East, and Africa at JPMorgan Chase, raised concerns about this rapid shift towards AI. He emphasized the need for a cautious approach, suggesting that amidst the enthusiasm surrounding AI in the banking sector, it is crucial not to neglect the fundamental elements of the industry. Hillery pointed out that JPMorgan is striving to maintain a balance between technological advancement and the valuable experience that younger employees require to prepare for their futures in finance. Failing to do so could lead to significant challenges down the road.