Barclays Is Cutting 5,000 Jobs as It Leans Further on AI
The bank says 1,000 posts have already closed and 4,000 more will go by the end of this year, as it reports £2.3bn profit for the three months to September
By AXY Business Desk ·
Key points
- Barclays is cutting around 5,000 jobs, about 5% of its global workforce, as it introduces more AI into its work.
- 1,000 posts have already been closed, with a further 4,000 reductions expected to be complete by the end of this year.
- Around 60% of the cuts will fall within support functions, including among developers.
- The bank made £2.3bn profit in the three months to September, higher than a year earlier but slightly below forecast.
- Chief executive CS Venkatakrishnan said technology investment is driving most of the efficiency gains so far, with AI as the icing on the cake.
Barclays is cutting around 5,000 jobs as it introduces more artificial intelligence (AI) into its work processes, the British bank said. The cuts amount to 5% of its global workforce, and most of them fall among operational and functional roles. The banking group said 1,000 posts had already been closed and that a further reduction of 4,000 is expected to be complete by the end of this year.
The announcement came alongside the bank's latest financial results. Barclays made £2.3bn profit in the three months to September. That was higher than the same period a year ago, but slightly less than the bank had forecast. The combination of rising profit and a shrinking workforce is the core of this story, and it is the kind of result that business leaders and economists have been watching closely.
Where the Job Cuts Are Landing
Barclays said around 60% of the job cuts will fall within its support functions, including among developers. Support functions are the teams that keep a bank running behind the front counter and the trading floor. They handle things like processing, internal operations, technology support and administration. Developers are the engineers who design, build and maintain the software that customers and staff rely on every day.
That detail matters because it shows where the bank is looking for savings. Front-facing staff, such as those who advise customers or deal with them face to face, are not the main focus of the figures the bank gave. Instead, the cuts are concentrated in the parts of the business that sit between the customer and the systems that serve them. For the people working in those teams, the change is immediate and personal. Many of them will be deciding whether to stay, whether to apply for other roles inside the group, or whether to look elsewhere.
The bank did not say in its statement which specific teams or locations will be hit hardest, beyond the split between support functions and other roles. What it did say is that the job cuts are part of a broader change in how the group works, rather than a single one-off exercise.
Why Barclays Calls AI the Icing on the Cake
Barclays said the changes are the result of an ongoing modernisation plan, and that the use of AI is "icing on the cake" of that strategy. Group chief executive CS Venkatakrishnan made the same point in comments that show how the bank sees the balance between technology and jobs.
He said the job cuts were the result of significant investment in technology to simplify and improve the business. "That is driving the bulk of the efficiency gains that you've seen so far," he said. He also said "AI has an important role to play and may have a more important role to play in the future."
His most revealing remark was the one about the cake. "I've often said that it is the icing on the cake – it's not the cake – because you need to do the infrastructure build to get the benefits of AI." In plain terms, he is saying the bank has to rebuild its underlying systems first. Only then can AI tools deliver savings. In this account, the bulk of the savings so far come from the wider technology work, not from AI on its own.
That distinction is worth holding onto. Headlines about AI and jobs often treat the technology as the single cause of job losses. Barclays is describing something more gradual: years of system upgrades, with AI as the layer added on top. For customers and staff, the practical result may be the same. But for anyone trying to judge how far AI itself is changing employment, the bank's own description suggests the picture is more complicated.
A Three-Year Cost Programme Nears Its End
Barclays said it is reaching the end of a three-year cost-cutting programme. That programme has focused mainly on its UK retail banking arm, which serves everyday customers with current accounts, savings, loans, mortgages and credit cards, as well as small businesses. The investment banking division, which handles large deals and trading for corporate and institutional clients, is also affected by the changes.
Cost-cutting means reducing the money a company spends on running its business. For a bank, a large share of those costs is staff pay, premises and technology. A three-year programme gives a company time to reshape how it works rather than making a single sudden cut. The bank's latest figures suggest that work is now reaching its final stage, with the job reductions being the most visible part.
For UK customers, the programme may already have meant changes they have noticed without a clear explanation, such as how quickly queries are handled or how online services work. The bank's statement did not spell out customer-facing changes, so it would be unwise to assume what those are. What is clear is that the work behind the scenes has been running for some time, and the job cuts are its latest and largest visible step.
Profit Up on Last Year but Short of Forecasts
Barclays' £2.3bn profit for the three months to September is a healthy figure, and it was higher than the same quarter a year earlier. Yet the bank said it was slightly less than forecast. That gap is small, but it matters for investors who had set their expectations based on earlier predictions.
The result also helps explain why the job cuts are being presented in terms of efficiency. When a bank wants to show that it can earn more money with fewer people, the quarterly figures are where that case is tested. The bank said the efficiency gains from its technology investment are already visible in its results. The question for the rest of the year is whether those gains keep building as the remaining 4,000 reductions are completed.
Economists have been watching companies' results for signs that investment in new technology, and AI in particular, is making a practical difference to day-to-day operations. Greater efficiency and lower employment are the two signs they are looking for. Barclays' figures give them one example to compare with others, but a single bank's results do not settle the broader question.
What Comes Next for Staff and Customers
The next key date is the end of this year, when the bank expects the second group of 4,000 reductions to be complete. That gives a clear timetable. The 1,000 posts already closed are the first stage, and the rest of the plan will show whether the bank can keep to its schedule and its stated targets.
This could be a turning point for how the bank operates. If the efficiency gains continue, Barclays may point to them as proof that its technology investment is working. If they stall, the bank may face the harder task of explaining why a large programme of job cuts has not delivered the expected returns. Either way, the next set of results will be watched closely by staff, investors and rival banks.
For people working at Barclays, the immediate question is how the cuts will be carried out and where they will land. Staff in support functions, operational roles and development teams are the groups the bank has named most clearly, and they are likely to be watching for details. For customers, the longer-term question is whether the changes lead to faster and cheaper services, or whether they bring fewer people to handle problems when something goes wrong.
The bank's own framing gives the clearest guide to what comes next. Venkatakrishnan's comments point to continued investment in infrastructure, with AI expected to play a bigger role over time. That suggests the story of Barclays and AI is not finished with this round of cuts. It is more likely to be the start of a longer process in which technology and staffing are reshaped together.
Questions and answers
How many jobs is Barclays cutting?
Barclays said it is cutting around 5,000 jobs, which it said amounts to 5% of its global workforce. The bank said 1,000 posts had already been closed.
Why is Barclays cutting jobs?
Barclays said the cuts are the result of an ongoing modernisation plan and significant investment in technology. The bank describes AI as the icing on the cake, with the wider infrastructure work driving most of the efficiency gains so far.
Which Barclays roles are affected by the job cuts?
Barclays said most of the cuts are among operational and functional roles, and around 60% will fall within support functions, including among developers. The UK retail banking arm and investment banking division are both affected.
When will the Barclays job cuts be complete?
Barclays expects the further reduction of 4,000 posts to be complete by the end of this year, after 1,000 posts were already closed.
Topics: Barclays, Artificial intelligence, Job cuts, UK banking, Cost-cutting, CS Venkatakrishnan, Investment banking
Sources: BBC Business RSS
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