UBS is the latest bank to cut jobs in New Jersey as the financial sector shrinks

Swiss bank UBS is laying off 51 employees at its Weehawken office, public records show, as New Jersey’s broader banking and financial sector grapples with tightening budgets in uncertain economic times.

According to Reuters, UBS is reportedly looking to cut its costs by $13 billion, which includes cutting one in 12 employees. A UBS spokesman declined to comment on the matter.

State filing data showed that so far, five financial institutions have announced layoffs in New Jersey in 2024: The Bank of New York Mellon Corporation, TD Bank, Prudential Financial, Citibank and JPMorgan Chase Bank.

Some of these banks – including Citibank and Charles Schwab – are cutting employee numbers by thousands or tens of thousands across their operations.

Nationwide, Charles Schwab is laying off 2,000 workers and Citibank is laying off 20,000 workers.

“Banks are cutting back-office costs, which unfortunately includes reducing staff and headcount,” said Christopher Marinac, director of research at Janney Montgomery Scott, a financial services firm. “Overall, banks’ performance is stable and generally not growing. Moreover, bank balance sheets will not expand much this year.”

One factor is the Federal Reserve, which has raised interest rates 11 times since the Covid-19 pandemic. This resulted in higher mortgage rates for homebuyers, which meant fewer people took out mortgages, prompting Wall Street to pursue layoffs, according to a CNBC report.

This resulted in the state’s first job loss in six months, unemployment data show.

“Banks are cautious about extending new loans and trying to retain more capital as the Federal Reserve soon tightens standards and raises capital requirements,” Marinac said.

James Hughes, an economist at Rutgers University, told NorthJersey.com that white-collar jobs in banking and finance have become saturated after a two-year hiring spree that followed the Covid-19 pandemic.