JPMorgan cuts 40% of roles in some areas as AI reshapes banking

JPMorgan Chase has cut 30% to 40% of staff in certain departments as artificial intelligence replaces human work, though most affected employees moved to other roles within the bank.

JPMorgan Chase eliminated 30% to 40% of roles in discrete areas as artificial intelligence replaces human work, though most affected employees moved to other parts of the bank, Chief Executive Officer Jamie Dimon said.

"We have had discrete areas where we did reduce jobs by 30% or 40%, and most of those people were offered jobs elsewhere," Dimon said during the bank's July 14 earnings call. "We do expect that."

The job cuts come as JPMorgan deploys almost 1,000 AI use cases across fraud detection, marketing, note-taking and risk management, part of a roughly $20 billion annual technology budget. The bank reported second-quarter net income of $21.2 billion, up 41% from a year earlier, on revenue of $57.35 billion that beat the $50.61 billion consensus estimate. Earnings per share of $7.70 topped the $5.55 forecast by 38.7%.

Dimon cautioned that AI will not dramatically shrink the bank's overall expense base because competitors can deploy similar tools, forcing savings to flow to customers rather than shareholders. "You don't uniquely benefit from AI," he said. "In a competitive, capitalist world, we all will use AI to do a better job for the customers."

The bank raised its full-year adjusted expense guidance to about $107.5 billion, up $2.5 billion from its earlier view, with Chief Financial Officer Jeremy Barnum attributing most of the increase to higher volume- and revenue-related costs tied to stronger activity. He also flagged AI token expenses as a growing line item, describing them as "trivial" for now but forecasting "meaningful acceleration" in the second half of the year.

JPMorgan's workforce shift mirrors a broader trend across Wall Street as banks race to integrate generative AI. The lender is likely to hire fewer traditional bankers and more AI specialists and data scientists in the future, Dimon said in May. The bank's return on tangible common equity reached 23% in the second quarter, while its standardized CET1 ratio stood at 14.1%.

The question of how AI reshapes banking employment carries implications beyond JPMorgan. If the largest U.S. bank by assets can cut 30% to 40% of roles in specific functions while redeploying workers, smaller competitors may face pressure to follow suit — or risk falling behind on efficiency. For now, Dimon said the bank is focused on retraining employees rather than broad layoffs. "We are preparing to make sure we can retrain our people," he said.

This article is for informational purposes only and does not constitute investment advice.