Barclays said it is cutting around 5,000 jobs this year, about 5% of its workforce, as it uses technology such as AI to slash fixed costs and improve returns.

Chief financial officer Anna Cross told reporters that roughly 1,000 roles have already gone, with the remaining cuts to be completed by the end of the year.

Around 60% of the reductions will hit support functions such as developers, in one of the clearest signs yet from a big bank of how AI is enabling firms to reduce headcount in such roles.

The announcement came alongside third-quarter results showing pre-tax profit of £2.3 billion, up 12% from a year ago but undershooting analyst forecasts.

The scale and speed stand out: 5% of a major European lender's workforce being removed within a single year, with the bank explicitly crediting AI and automation rather than a crisis or merger.

According to Global Banking & Finance Review, Barclays targets £2 billion in cost savings through deeper AI adoption and is investing around £500 million this year in technology and AI, and cites benefits already counted, including 6,000 contact-center hours saved and a 20% reduction in fraud-related inbound calls.

The Independent reports the workforce stood at around 93,000 globally at the end of 2025, and that the majority of reductions relate to operational and functional roles.

The cuts landed with a mixed quarterly report. Third-quarter profit of £2.3 billion rose 12% year on year, yet fell short of analyst forecasts as the investment bank underperformed.

Investment bank income came in at £3.1 billion against forecasts of £3.3 billion, with fixed income trading sliding 19% to £1 billion — worse than the roughly 5% drop among US peers — while equities revenue jumped 47%, outperforming the average 37% gain across the top five US players. CEO C.S.

Venkatakrishnan said he was 'disappointed' by the fixed income result, blaming a volatile quarter and weak rates and credit trading. The bank took a further £201 million in 'structural cost actions' in the quarter.

Venkatakrishnan framed the job cuts as the payoff of years of technology investment, which The Independent reports involved 'modernising our platforms and harmonising our systems and having simpler and better processes.'

He described AI as 'the icing on the cake – it's not the cake – because you need to do the infrastructure build to get the benefits of AI.'

The bank is nearing the end of a three-year strategy of major cost-cutting and technology ramp-up, making roughly £200 million of structural cost actions in the quarter, about £600 million for the year, double what it had earlier expected, with a further £300 million of savings planned for the final quarter, per The Independent.

Analysts read the announcement as a bellwether for banking employment. 'The cuts illustrate just how significantly AI and automation could reshape the banking industry over the next few years,' said Will Howlett, financials analyst at Quilter Cheviot, quoted by The Lufkin Daily News.

Barclays is not alone: companies worldwide including Microsoft and HSBC have announced layoffs this year as automation increasingly impacts employment. The bank's shares slipped just 0.1%, outperforming other lenders, though they have fallen 12% this year in line with European peers.

The Independent notes the bulk of cost cutting came from the UK retail bank, with a proportion in the investment bank.

Barclays is the first major European lender to report quarterly earnings, and its results may be overshadowed by UK finance minister John Healey's first budget on October 28, where further taxes on banks may be levied.

Healey has refused to rule out hiking taxes on banks' bumper profits despite intensive lobbying, as the government seeks revenue while higher borrowing costs strain the public purse.

Venkatakrishnan told The Independent the sector already bears a higher tax burden than other countries, calling any hit 'bearable' for Barclays given its international earnings, but 'a question of proportion and market signalling.' The remaining 4,000 cuts are due by the end of the fourth quarter.