A new analysis from Morgan Stanley paints a stark picture for the future of European banking employment, predicting that up to 200,000 jobs—roughly 10% of the sector’s workforce—could be eliminated by 2030. The forecast suggests that a combination of aggressive artificial intelligence adoption and continued branch closures will force a fundamental restructuring of how these financial institutions operate.
The Efficiency Mandate
The report, which examined 35 major European lenders employing over 2 million people, identifies a clear shift in strategy. Banks are increasingly looking to technology not just for innovation, but as a primary lever for cost reduction. The analysis suggests that roles in “central services”—such as back-office administration, risk management, and compliance—are most vulnerable.
These areas are traditionally data-heavy and repetitive, making them ideal targets for automation. By deploying AI to handle tasks like transaction monitoring and regulatory reporting, banks aim to execute workflows faster and cheaper than human teams. The move is driven by a need to improve cost-to-income ratios, a metric where European banks have historically trailed their US competitors.
Major Lenders Already Cutting Back
The trend is not hypothetical; major institutions are already executing significant downsizing plans. Dutch lender ABN Amro has announced it intends to cut its workforce by approximately 20% by 2028. The bank cited the digitization of services and the need for a simplified organizational structure as key reasons for the reduction.
Similarly, French banking giant Société Générale has taken a hardline approach to costs. The bank’s leadership has indicated that no department is off-limits as they seek to align expenses with revenue realities. These moves signal that the industry is moving away from the stability of the past toward a leaner, technology-first operational model.
A Global Phenomenon
While Europe is the focus of this report, the push for AI-driven efficiency is global. In the United States, Goldman Sachs recently implemented hiring freezes and targeted job cuts under its “OneGS 3.0” initiative. This strategy explicitly aims to use AI to streamline operations ranging from client onboarding to regulatory compliance, mirroring the tactics seen across the Atlantic.
Jason Napier, a banking researcher at UBS, noted that the financial sector is actually playing catch-up. Other industries like law and consulting have already begun integrating these tools, and banks are now under pressure to prove they can deliver similar efficiency gains to investors.
Market Impact & Context
This potential shedding of 200,000 jobs represents a massive structural change for a sector that has long been a major employer in Europe. It highlights a critical pivot point: banks are no longer viewing headcount growth as a sign of health. Instead, “revenue per employee” is becoming the dominant metric.
For years, strict European labor laws made large-scale layoffs difficult. However, the gradual nature of these planned reductions—spread out over several years—allows banks to achieve leaner teams through attrition and hiring freezes rather than just sudden mass firings. This shift puts European banks on a collision course with unions and regulators, who will likely scrutinize whether automation is being used to bypass labor protections.
Conclusion
As 2030 approaches, the definition of a banking career is likely to change permanently. The focus will shift from administrative processing to roles that require human judgment, leaving fewer entry-level spots for the next generation of bankers
