After being a prominent part of Manhattan’s high-end establishment for 200 hundred years, JPMorgan now plans to continue moving jobs out of the city. It is considering to reduce its workforce in New York City and move employees to other locations where costs are likely to be lower. The other locations in consideration include Plano, Texas, and Columbus, Ohio.
Not only shifting a few employees, but the multinational investment bank is contemplating selling its investment banking headquarters, located at 383 Madison Ave. The headquarters has well-paid bankers and traders, who might soon be asked to move to other locations or a new office in town. Last year, it had shared plans to build a headquarters at 270 Park Avenue.
Relocating employees and shifting base is not a new tactic by such a large player. Large companies often shift their headquarters and expand facilities based on the availability of workforce and for other reasons like low cost, taxes and other regulations.
In the case of JPMorgan, its spokesman Joe Evangelist shared that the bank believes it’s healthy to continually review its facilities and where employees are based, and that the new headquarters will house twice as many employees as the old tower did.
Reportedly, JPMorgan has already built up and staffed offices in lower-cost areas like Plano, Texas, Columbus, Ohio and Wilmington, Delaware. In fact in Texas JP Morgan currently has the second-largest presence in the country with more than 24,000 employees. By the end of this year, the Plano campus workforce will expand to 6,500 from 4,500. Texas, one of only a handful of states in the U.S. with no statewide income tax seems like a lucrative market for JP Morgan. Ranked 15th in terms of best overall business climate, as per a study from the Tax Foundation, Texas seems like a hot location for the american multinational.
Besides Texas, Ohio that ranked 42nd out of 50 in terms of business climate, (better than New York, which is ranked 48th) is another key location for JPMorgan. Currently, JPMorgan has about 19,200 employees in Columbus. Further, in Wilmington, Delaware, JPMorgan has five office locations with more than 3,800 employees.
JPMorgan is not the only one considering to shift workforce, as many fear recession and deal with various other market turbulences, other firms like Goldman Sachs Group and Deutsche Bank have also taken similar steps and have either moved away from New York or are looking to. Goldman Sachs Group has built up operations in Salt Lake City, Deutsche Bank has expanded in Jacksonville, Florida, and AllianceBernstein Holding LP last year announced plans to move its corporate headquarters to Nashville, Tennessee.
Only time will tell if more multinationals follow suit or not.
Image source: Fox business