Banking giants like Goldman Sachs and Morgan Stanley are starting to introduce these regulations, as Wall Street increasingly prioritizes using AI for finance-related tasks.

Wall Street workers lose their jobs to AI

Specifically, some have proposed that investment banking analyst positions be cut by up to two-thirds, while those hired will be paid less because their work is being handled by artificial intelligence.

“The easy idea is to just replace a junior employee with an artificial intelligence tool,” Christoph Rabenseifner, chief strategy officer for technology, data and innovation at Deutsche Bank, told the New York Times .

The report found that banks have been testing AI software, and have nicknamed it “Socrates.”

Meanwhile, a Goldman Sachs representative told Business Insider that the bank is still in the “early stages” of exploring AI technology, adding that they are “pleased” with the results so far. But they are not thinking about scaling back hiring right now.

“We have no plans to make any changes to our analytics team at this time,” the spokesperson said. Deutsche Bank told Business Insider it was too early to comment on any job cuts. Morgan Stanley did not respond to a request for comment.

AI wins with tremendous performance

However, some financial industry executives have previously hinted publicly at changes in the future of the workplace. In his annual letter to shareholders, JPMorgan boss Jamie Dimon said artificial intelligence has the potential to “eliminate certain types of jobs or roles.”

In 2023, Larry Fink, chief executive of investment firm BlackRock, told the Financial Times that AI has “huge potential” to improve employee productivity, later adding that the firm is spending “a huge amount of time” on artificial intelligence.

Goldman Sachs estimates that about 300 million workers could be significantly affected by AI. And a McKinsey report suggests that 12 million people could be completely replaced by AI by 2030.

Consulting firm Accenture takes an even more extreme view of industry disruption, predicting that AI could replace or supplement nearly 75% of all working hours in banking.

“AI will enable tasks that take 10 hours to be done in 10 seconds,” Jay Horine, head of investment banking at JPMorgan, told the New York Times , referring to Wall Street analyst positions. “My hope and belief is that AI will make the job more enjoyable.”