Bank of America let go 43 more specialists and clerks from its New York Stock Exchange floor staff, and warned remaining employees that more layoffs are expected.
According to the New York Post, the unit will be down to about 65 employees by springtime - from 165 on January 1. A spokesperson told the newspaper BOA the layoffs were forced by the Big Board's Hybrid system, which allows trades to be made electronically.
In January, Lehman Brothers, Goldman Sachs and Bank of America together cut 55 staffers from the floor of the New York Stock Exchange. Around the same time, market maker Van der Moolen Specialists cut 30 percent of its U.S. workforce. Chief Executive Richard den Drijver said the decision was "necessary ... due to implementation of the NYSE hybrid market and more automation at the point of sale."
Observers say floor traders, to stay relevant, should become well-versed in the IT side of the field, mastering spreadsheets and the tools used for technical analysis. "You have to be someone with strong investigative tendencies to succeed in this business - a much more opinionated trader," said one former trader, who asked not to be identified. "You have to be able to see opportunities and correlations between differing products, from heavily and thinly traded ones"
Electronic traders also must be able to deal with the idea of taking more risk, he said. "Previously, when the bell rang you knew who was in the pit with you, and you knew the crowd. Now, you have to be able to investigate the market and use the necessary technology out there to make it."