Bank of America to cut 30,000-35,000 jobs
Bank of America plans to cut up to 35,000 jobs as it merges with Merrill Lynch and deals with a slow economy. Rumors had circulated for the past week that the merger would bring heavy layoffs. Charlotte-based Bank of America confirmed 30,000 to 35,000 positions will be cut over the next three years. That's about 11 percent of the combined workforce. Bank of America says the merger and the weak economy make layoffs inevitable. Tony Plath is a Professor of Finance at UNC Charlotte. He says job cuts always accompany a merger, but yesterday's announcement is more about weakness in the general economy. "Because essentially the bank is cutting deeper than we first thought they would cut. And the bank is cutting more broadly," says Plath. Bank of America is the latest big bank to announce substantial layoffs as the industry continues to deal with more defaults on loans. Citigroup plans to eliminate 52,000 jobs by early 2009. Bank of America agreed to buy Merrill Lynch in September for what is now worth $20 billion in stock. At that time Merrill Lynch was crippled by the economic meltdown. Last week shareholders of both companies approved the deal. Bank of America says early next year it will have a better idea just how many jobs will be lost.