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BlackRock to cut 500 jobs in era of 'significant' change

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BlackRock to cut 500 jobs in era of 'significant' change

BlackRock is to cut 500 jobs as it repositions its business towards higher growth areas. 

The cuts amount to 3% of its 14,900 workforce. The world's largest asset manager pointed out that headcount would remain 4% higher than a year ago.

In a memo distributed to BlackRock staff today seen by Wealth Manager, president Rob Kapito said some parts of the business would be more impacted than others. The firm did not provide a breakdown of which countries or departments would be impacted by the cuts. 

'By simplifying certain structures and processes, we are making it easier for our clients – and our own employees – to navigate the firm and leverage the full breadth of BlackRock’s capabilities,' Kapito said in his note. 

'We believe these changes allow us to be more nimble and to create more opportunity for people to stretch their responsibilities and drive their careers.' 

BlackRock said it would be investing its resources in the following four key areas: 

  • Solving the investment needs of clients in areas such as retirement, illiquid alternatives, ETFs and factors
  • Extending leadership in technology
  • Leading the industry’s shift from product selection to portfolio construction
  • Expanding distribution capabilities in high-growth markets around the world

The memo noted that the combination of growing market uncertainty, along with the evolution of investor preferences and the increasing complexity of the ecosystem in which the firm operates were major factors behind the decision.  

'As our industry undergoes an era of significant change, we can continue to outperform by building our business in high-growth markets and using our advantages in technology and portfolio construction to lead change in the industry,' Kaptio said.

'[But] executing on this strategy requires that we move decisively to refocus resources where the impact will be greatest. It also requires that we operate as efficiently as possible and are organised for success.'

The company will also be making additional changes in the coming weeks.

'Everything we are doing reflects our focus on the long term,' Kapito added.

'The uncertainty around us makes it more important than ever that we stay ahead of changes in the market and focus on delivering for our clients.

'We are asking everyone in the firm to embrace the changes that this environment requires to continue driving future growth and delivering for our clients and shareholders.'

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