Goldman Sachs are an investment bank...and they're kinda like the créme de la créme of banking.
Background: Goldman Sachs are an investment bank and broader financial services company. They're kinda like the créme de la créme of banking.
What happened: This year, things haven't been that rosy over at ol' Goldman's house. This crew missed their quarterly profit expectations (a very rare occurrence for these straight-A students)...and shares tanked 8% when news broke.
What else: The bank says there are a few things at play. But mainly - it's about wage inflation. In other words, Goldies is rewarding top talent in a competitive labour environment.
💡Wage inflation is the increase in workers' wages over time. It generally happens naturally - as the price of goods and services increases and the cost of living rises.
💡But in this case, it seems that wage inflation happened due to labour pressures. In the US, talent shortages are at a 10-year high. Back in 2010, 14% of employers struggled to fill positions. Today? it's 69%. It's the same story in Oz, too.
💡The lack of quality workers means companies need to increase salaries to attract and retain new talent. For Goldman Sachs, these higher wages are crunching the company's bottom line.
Sign up for Flux and join 100,000 members of the Flux family
