Goldman Sachs warns of more job losses with merger of jumbo

New York: Wall Street’s best matchmaker for megadeals sees a wave of corporate takeovers with worrying implications for the workforce: an increase in job losses.

“Politicians are going to face the uncomfortable reality that you will abandon more large companies and that there will be more job losses along the way,” John Waldron, president of Goldman Sachs Group, said at a conference. Friday. “You will see that a significant amount of large capital supply agreements are obtained, with stronger, healthier businesses being the acquirer and exploiting the weaknesses in their industry or elsewhere.”

The remarks of Goldman’s second commander come just weeks before a US presidential election reformed by the economic downturn of the coronavirus pandemic and now halted stimulus talks that threaten to undermine job recovery. Waldron warned against ‘tough unemployment’, with people already confronted with workforce automation, while seeing more jobs disappear once businesses come together.

“Our customers want to be more offended and do transactions. That’s good,” he told the virtual event. But that includes large companies that “want to consolidate smaller businesses, and that would be socially complex.”

Large companies outside the most difficult industries can use financing at extremely low rates accepted by central banks to boost the economy during the pandemic. “And the market is giving them the license to do M&A, which encourages more consolidation,” Waldron said.

Goldman Sachs has been one of the biggest beneficiaries of the turmoil this year, with its core operations in Wall Street trading and trading, and an increase in demand from investors and companies seeking to reposition themselves or raise capital. In Goldman and its competitors, divisions providing these services have seen revenue and profitability rise to the highest levels in years.

Source: Gulf News

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