KBRA Financial Intelligence

U.S. Employment Data Reveals Cuts to Banking and Finance Jobs

September Payrolls Wipe Out 2025 Gain in Finance Jobs

The long-delayed nonfarm payrolls report for the month of September indicated that the U.S. labor market had been on shakier ground than previously thought throughout 3Q 2025. While 119,000 jobs were created in September, revisions to the two months prior shaved a collective 33,000 jobs off previously reported figures and revealed an outright contraction in employment for August.

The Bureau of Labor Statistics (BLS) report showed a net decline in finance and insurance payrolls in August and September’s non-seasonally adjusted figures, wiping out a year-to-date (YTD) gain that had accumulated in this category. Throughout the first nine months of 2025, the total count of U.S. finance and insurance jobs receded by 13,000. The depository credit intermediation subcategory—which includes banks, savings institutions, and credit unions—has contributed roughly 2,900 job cuts to the decline.

3Q Bank Data Backs Jobs Report Findings

The latest Federal Financial Institutions Examination Council (FFIEC) call report data analyzed by KBRA Financial Intelligence (KFI) broadly aligns with the results of recent BLS surveys. Full-time employment across 4,432 U.S. commercial and savings banks fell by a net 7,460 positions year-over-year (YoY) in 3Q 2025. The drop aligns with the same trajectory observed in recent years, as banks have shed a cumulative 81,000 jobs since bank head count peaked in 1Q 2023.

Large banks (those exceeding $250 billion in assets) slashed full-time employment by 0.8%—or 9,268 jobs—between 2Q and 3Q 2025. Just three banks were responsible for most of that sum, with Citibank, N.A (KFI Score: B), Wells Fargo Bank, N.A. (KFI Score: B), and The Bank of New York Mellon (KFI Score: B) reducing their head counts by 4,900, 2,640, and 1,040 jobs, respectively.

Interestingly, small to midsized institutions below the $250 billion asset threshold bucked that trend, increasing employment by 0.2%—1,642 jobs—versus the prior quarter. KFI has previously noted that some layoffs at larger banking institutions could be less related to general labor market softness and more closely linked to the deployment of technological efficiencies like artificial intelligence (AI) that have made certain positions redundant.

Nonbank Hiring Spree Slips Into Decline

Despite mounting job losses among their commercial banking subsidiaries, bank holding companies (BHC) had largely kept head count rising via hiring by nonbank affiliates. Although the former has absorbed the lion’s share of workforce consolidation among banks in recent years, BHC staffing (excluding their underlying commercial banking businesses) is now experiencing a spate of layoffs for the first time since 2020.

Often dominated by securities firms, which include broker-dealers, asset managers, and investment advisers, as well as service companies focused on IT or data processing, these subsidiaries have collectively reduced head count by 2% YoY—a loss of roughly 7,030 jobs. Last month, KFI noted that several of the most positive trends in 3Q 2025 bank earnings emerged from the corporate and investment banking (CIB) segment, such as surging income in institutions’ sales and trading businesses, as well as a long-awaited rebound in investment banking. If such robust growth is maintained, it is possible that further reductions to bank-related workforces remain concentrated within commercial bank operations.