(RTTNews) - The U.S. banking industry is expected to eliminate more than 200,000 jobs over the next decade due to robots and other technological efficiencies, according to a report by analysts at Wells Fargo. The job cuts reportedly represents more than 10 percent of total banking jobs.
According to the study, the job cuts would be felt most in back office, bank branches and call centers where the number of employees could fall by between 20 and 30 percent, with jobs related to technology, sales, advising and consulting least impacted.
Mike Mayo, a senior analyst at Wells Fargo Securities LLC, was quoted as saying that the $150 billion being spent by U.S. banks annually on technology will lead to lower costs as almost half of the banking expenses are related to employee compensation.
The report provides details of how artificial intelligence could cut mortgage processing costs by up to 20 percent, while cloud computing could lead to huge savings for banks.
Several other bank executives and consulting firms have also predicted huge job cuts in the banking industry due to automation.
According to a report released by McKinsey & Co. in May, the headcount for front-office workers could fall nearly a third due to automation. Forty percent of existing jobs could be automated with current technology, the report said.
In June 2018, Jamie Forese, president of Citi and CEO of the bank's institutional clients group told the Financial Times that robots could replace as many as 10,000 human jobs at Citi within five years.
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