Wall Street CEOs on AI Job Impact: What We Know

Top bank executives are publicly addressing the impact of artificial intelligence on employment, with mixed messages about the future of banking jobs. Jamie Dimon of JPMorgan Chase stated plainly that AI will eliminate jobs, while David Solomon of Goldman Sachs believes the technology will allow hiring of more high-value workers.

Jane Fraser of Citigroup noted that while productivity is increasing dramatically, widespread adoption remains low at around 10%, making it difficult to predict long-term layoff trends. Charles Scharf of Wells Fargo expects continued headcount reduction, and Brian Moynihan of Bank of America is focusing on retraining employees rather than hiring.

The executives agree that AI will drive efficiency across all banking functions, from software development to customer service, but disagree on whether this translates to net job losses or simply slower hiring growth.

Jamie Dimon has been the most direct about AI's impact on employment. At a Fortune-hosted conference, he stated, "It will eliminate jobs," adding that people should "stop sticking their heads in the sand."

These comments echoed remarks Dimon made at a town hall for employees in Columbus, Ohio, where he explained that AI will "change some of your jobs," serving as a "copilot," handling "drudgery," or eliminating positions entirely.

Despite the warning about job elimination, Dimon sees headcount at JPMorgan remaining steady or even rising in the near term if the bank executes well on AI implementation. He emphasized that AI will affect "every job, every application, every database," making people "highly more efficient."

Dimon provided a practical example of this efficiency: "Like a lot of you clicking away, taking notes. You won't have to do that because it will — you can just summarize what Jamie said. You push a button, and you don't have to waste all that time."

He also noted that increased efficiency could create new roles, particularly in cybersecurity. "We use it for risk and fraud recognition, and bad guys are going to use it," Dimon said. "So, we have to use it to counter the bad guys. We have to use it to get better and better in cyber."

David Solomon of Goldman Sachs offers a different perspective, focusing on quality over quantity. In a memo released alongside President John Waldron and CFO Denis Coleman, Solomon explained that AI will drive efficiency, which means "slowing hiring and reducing roles" at the firm.

The memo, part of the OneGS initiative, stated: "We're asking people to resist head count growth where possible and increase their focus on efficiency." This is part of a broader effort to find the "right team structure" and gain "more agility."

However, Solomon told Axios in October, "We need more high-value people." He explained, "We can afford more high-value people to expand our footprint and continue to grow and broaden our business."

At a conference last month, Solomon noted that while "there are obviously things where we're going to have a lot fewer people," he would "love to have the capacity to go get more people to spend time with clients." He believes AI will have its most immediate impact on software development.

Solomon continues to predict that AI will grow Goldman's headcount over the next 10 years. Speaking generally about economic adaptation, he said, "Our economy is very nimble, very flexible. And when you look at the technology that has flooded over hundreds of years into our society, we adapt. We find new businesses. We find new jobs. I don't believe it will be different this time."

Jane Fraser of Citigroup highlighted significant productivity improvements already occurring. "AI-driven automated code reviews have exceeded 1 million so far this year," she said on a recent earnings call, "dramatically improving our developers' productivity." This innovation alone saves around 100,000 hours of weekly capacity.

Fraser noted that AI is also helping customer service teams resolve inquiries faster and wealth advisors provide more personalized advice. However, when asked if productivity gains would lead to layoffs, Fraser expressed concern that AI might "pinch" the job market "before it pays."

She emphasized that adoption is only at 10% globally, and it's too early to predict layoff trends. "It's not there yet, and we don't know how quickly," Fraser said, noting adoption would need to reach 50% to see real impact.

Charles Scharf of Wells Fargo has been unequivocal about job reductions. "It's likely we'll have less headcount as we look forward," he told Reuters, adding the bank would prefer to achieve this "through attrition as possible."

Scharf dismissed those who claim AI won't reduce jobs: "The opportunities that exist in AI are very significant, and anyone who sits here today and says that they don't think they'll have less head count because of AI either doesn't know what they're talking about or is just not being totally honest about it."

He later clarified that most executives do know AI will reduce headcount but are "afraid to say it." Wells Fargo engineers are already 30% to 35% more productive due to generative AI tools.

Brian Moynihan of Bank of America has taken a different approach, focusing on workforce transformation rather than pure reduction. While he conceded that generative AI has already shrunk some departments, the bank is prioritizing training employees for tasks that large language models cannot perform.

"The key to that is really redeploying people and re-skilling them," Moynihan said. "We have to be more mindful about training them along multiple dimensions than we might have been two or three years ago."

At the Goldman Sachs financial services conference, Moynihan explained that the bank is managing flat overall staffing levels by redeploying employees rather than hiring more, with AI absorbing additional workload.

He pointed to Erica, Bank of America's consumer-facing AI assistant, as a prime example. In November, the bank had 1.4 billion digital connections with customers, and Moynihan said, "We think it saves, today, about 11,000 FT equivalents."

Bank of America has also set an industry standard with a minimum wage of $25 an hour across the company, suggesting that while AI may reduce overall headcount, remaining employees will be better compensated.