It worked for Jes Staley, CEO at Barclays, so why shouldn't it work for Christian Sewing, CEO at Deutsche Bank?
When Staley turned up at Barclays in 2015, the British bank was hiring 10,000 people a year across its businesses. Staley, who wanted to cut 7,000 people from the bank's overall headcount, promptly forbade all but non-urgent recruitment for over a year. In four months, he managed to cut 6,000 people from the investment bank. One year later, Barclays as a whole was down 13,600 people.
Now Christian Sewing seemingly wants to do the same thing. Reuters reported yesterday that Deutsche Bank sent a memo on Wednesday specifying that any new hires need to be approved by either Sewing, his CFO James von Moltke, or deputy CFO Karl von Rohr. The three men clearly don't want to be overwhelmed with approvals, so only "critical" roles should be submitted. The policy will apply throughout 2019.
The near-hiring freeze could give Sewing's cost-cutting plans new impetus. The CEO wants to cut 18,000 jobs at Deutsche Bank by 2022, but had until now given few indications of how this will happen - save the closure of the equities sales and trading business, which was thought to have up to 8,000 employees globally, including all support staff. When Deutsche announced its second quarter results last month, Sewing said only 900 cuts had already in the investment bank following the change of strategy in July.
By imposing a near-freeze on hiring this year, Sewing could turbo-charge his job cuts without actually cutting any jobs. Deutsche Bank hired 9,000 people last year, according to its HR report. Voluntary staff turnover in 2018 was 8.1%, or 7,430 of Deutsche's 91,737 people. If Deutsche stops hiring, it could conceivably therefore cut headcount by about 15,000 in two years without actually making cuts.
Of course, this presumes that Deutsche can stop hiring. The bank still has areas of strategic focus - like wealth management, where it's been hiring whole teams. Deutsche has also been making hires in its advisory and origination business, where Financial News recently suggested it could add 100 jobs.
45% of last year's hiring was into control and technology positions according to Deutsche's HR report - both areas where the bank has indicated that it intends to maintain a focus. Under the hiring freeze, Deutsche wants to fill new jobs that arise with internal movers. It has a way to go - last year, only 2,123 DB employees found new jobs in different divisions.
If you want to keep your job at Deutsche in the next three years, you might therefore need to be flexible - and to move into a control role. Either that, or you need to learn how to code.
Photo by Holger Link on Unsplash
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