At Deutsche Bank’s offices around the world on 8 July 2019, workers can be spotted leaving with their belongings. As part of its restructuring plan, the German-headquartered bank announced that it will be dramatically reducing its fixed income operations and eliminate its global equities business. This will result in 18,000 jobs being lost.
If you were to understand how banks operate, then you might not be surprised. After all, we’ve all heard our fair share of stories about how banks treat employees as ‘disposable’, which this TODAY article explains.
When companies are doing well, bonuses and higher salaries roll out rapidly to reward workers. But when things go downhill, employees are removed with great haste and not much qualms. With such a cavalier attitude, it is no wonder that loyalty on either side no longer exists.
Here are five hard truths I personally learnt about the working world from this Deutsche Bank episode.
Read Also: Here’s Why You Need To Prepare For Your Next Job While You’re In Your Current One
#1 Never Get Too Comfortable In Your Position
Even if you are a Director or Senior Manager of a company, you should never get too comfortable in your cosy seat. No one is immune to being “right sized”.
Your position could be made redundant at a restructuring meeting and erased from the organisation chart, or from headcount budgets. You might get demoted, or worse, retrenched. Furthermore, the rapid advancement of artificial intelligence (AI) means any jobs can be replaced anytime and anywhere.
Continue upgrading your skills to stay relevant is critical. Saving at least 6 months’ worth of income or rainy days will be more important than ever, since it is not a matter of ‘if’, but ‘when’.
No matter your job title today, stay humble and never be afraid or too proud to start again from a lower rung of the ladder.
Read Also: Banks Are Cutting Jobs In Singapore, And Why These Jobs Lost Are Unlikely To Ever Return
#2 Companies All Need To Make Money
Deutsche Bank is a German multinational investment bank that decided to establish the Asia Pacific Head Office in Singapore in 1988. Contrast this to DBS Bank, a local bank set up by the Singapore government in 1968 to take over industrial financing activities from the Economic Development Board.
All businesses have to earn profits. But subsidiaries of foreign companies in Singapore are more easily cut, if the business case for their existence is less attractive, or if the headquarters is facing difficulties.
Compare this to a local company which have their roots in Singapore and founded with the local market as its primary focus, and probably have the majority of their clients and workforce here as well.
So while you might covet the prestige of working in a foreign bank, perhaps it is the local banks that offer greater stability.
#3 Big Companies Are Susceptible To Slowdowns
It is a common misconception to think that large companies are risk-free when it comes to tackling economic adversities.
However, it is not impossible for large companies to fail due to an economic slowdown plus a cumulation of internal problems. Absence of strong leadership, overexpansion, and failure of planning will only worsen the plight of an already sinking company.
Singapore’s economy grew just 0.1% in Q2 2019, signalling the risk of a technical recession. The US-China trade war also resulted in business disruptions and slowdowns in hiring in both Singapore and the Asia-Pacific region.
Remember the Lehman Brothers? They were the fourth-largest investment bank in the United States. Yet, in 2008, they filed for bankruptcy following the drastic losses in its stocks, devaluation of assets, and decline in investor confidence.
#4 Whole Teams Can Be Cut
Adopting an attitude of “My colleague that has a worse work performance will be gone before me” will not keep you safe.
It is no longer good enough to be the best employee in your team. As we’ve seen in many examples in the past, including Nomura’s axing of 8 out of 9 equity research analysts in Singapore, no matter how outstanding you may be among your peers, that wouldn’t help much when whole teams can be axed.
For the case of Deutsche, whole teams of equity traders were dismissed in Europe, the US, and Asia, including Singapore. This is a sobering reality, which should be a driving force for us to continue to improve and maintain our employability.
#5 The Banking Sector Is No Longer As Glorious As Before
Fresh graduates should take note that gone are the days where banking was seen as a safe, prestigious career where you’ll steadily climb the corporate ladder and earn lots of money along the way.
As we can see from Deutsche Bank’s predicament, jobs in the banking and finance sector are no longer thriving, such as investment banking and traders of liquid assets (most currencies, equities, and commodities), just to name a few.
IMD Business School’s Arturo Bris also said that Deutsche Bank job cuts are simply the tip of the iceberg for the financial industry and that some banks are doomed to fail if they do not adapt to the new realities of the finance industry.
Read Also: 6 Ways to Cope and Bounce Back after Unemployment
Do Not Be Disheartened
As unfortunate as the Deutsche Bank retrenchment exercise was, and still is, employees in the banking and finance sector should not lose hope.
Even in other sectors, it can be worrying to wonder when you will be the next one to go. Therefore, it is important to stay relevant in your skills, so that it will be easier to find a job should you be let go. Maintaining a good relationship with your colleagues and forming a strong network will also prove to be useful if you need recommendations for a new job.
If you were recently retrenched, create an action plan. This can be rewriting your resume or seeking the assistance of a career coach. If needed, ask for help from employment agencies, which will be able to find you a job that matches your skills and experience. Lastly, manage your finances and avoid overspending.
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