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Westpac Schedules Major Job Cuts: Over 1,500 Employees at Risk
Westpac, one of Australia’s prominent banks, is poised to implement significant layoffs, potentially affecting upwards of 1,500 staff members. This upcoming redundancy round, which is projected to be the largest in a decade, comes under the leadership of newly appointed CEO Anthony Miller, who took charge in December. His strategy focuses on revamping the bank and streamlining operations to achieve substantial cost reductions.
Proposed Reductions and Context
Sources suggest that Miller has instructed managers to evaluate methods to decrease employee numbers by approximately 5% across most departments within the next few months. This shakeup follows underwhelming performance results for the first half of the year, where Westpac reported a 1% drop in cash profit, landing at $3.3 billion.
While a bank representative has clarified that specific figures regarding job cuts are still undecided, it is estimated that a 5% reduction from the current headcount of 35,240 could translate to around 1,700 positions being eliminated.
Workforce Adjustment Strategy
A spokesperson from Westpac indicated that workforce composition shifts are aligned with changing investment priorities. This includes ongoing hiring of customer-facing roles, such as home finance managers and business bankers, while necessitating cuts in other projects. The spokesperson clarified, “This means, from time to time, we make changes that may impact some roles and responsibilities.”
Miller emphasised the continual evolution of skills and roles within the banking sector, stating that the bank endeavours to retain employees through retraining and repositioning whenever feasible.
Impact of Digital Transition
These impending redundancies come in light of Westpac’s ongoing "Unite" program, aimed at significantly diminishing product offerings by simplifying processes and integrating technology. However, staff involved in this initiative are reportedly not at risk of losing their jobs.
The anticipated lay-offs further add to the 900 positions that were already eliminated during the previous financial year, reflecting a broader trend of workforce cutbacks within the banking industry.
Similar Trends at Commonwealth Bank
Westpac isn’t alone in this shift. The Commonwealth Bank of Australia has also been reducing its workforce, announcing the elimination of 163 positions, which includes 58 positions at Bankwest. Of these layoffs, 105 jobs are slated to be cut in New South Wales, with others in Victoria, Tasmania, WA, and Queensland. Remarkably, this comes on the heels of a 6% increase in cash profits, reaching $2.6 billion in the March quarter.
A Commonwealth Bank spokesperson attributed the decision to regular reviews aimed at optimising organisational structure to enhance customer experience.
Employment Outlook in the Banking Sector
This wave of job cuts has drawn concern from the Finance Sector Union (FSU), which mentioned that total job losses across Commonwealth Bank and Bankwest now approach 800. Union Secretary Jason Hall expressed that "CBA and Bankwest workers deserve job security," adding that frequent job cut announcements have left employees anxious about their roles.
Last year, Bankwest closed all 45 of its branches in Western Australia as part of its transition to an entirely digital banking model. The rationale behind this shift stems from evolving customer behaviours, with around 97% of transactions being conducted online and fewer than 2% of customers regularly visiting physical branches.
Conclusion
As the banking landscape in Australia adapts to digital transformation and changing consumer preferences, both Westpac and Commonwealth Bank are navigating a challenging transition that involves significant workforce adjustments. While these moves aim to enhance efficiency and reduce costs, they also raise pressing questions about job security for employees in the sector.
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