JSE announces job cuts amid recession
The JSE says it will cut its workforce by 14% as part of a cost cutting programme which will include reducing its technology operating expenditure by a minimum of R70 million over a two-year period.
Nicky Newton-King, CEO of JSE said: “globally, securities exchanges and other players in the financial services industry are adjusting the way in which they operate in response to changing regulatory requirements and the fast-pace of technological developments.
“In addition, on a macro-economic level, the country continues to be plagued with low economic growth, rating downgrades and a loss of business confidence. This has negatively impacted market activity.”
South Africa entered a recession in June, following a consecutive contraction of GDP from the previous quarter.
“The fast moving nature of our business requires us to change the way in which we operate so that we are as nimble and as cost effective as possible. We cannot do so without significantly rethinking our cost base, our operating model and the way we are structured as a business,” Newton-King said.
She said the operational changes will involve a reduction in the company’s full time staff complement by approximately 60 people (14%) in 2017.
Once completed, these initiatives will result in annualised cost savings of nearly R170 million which will be fully realised from 2019 onward, the group said. This is in addition to the nearly R65 million annualised savings already achieved to date through a combination of removing vacancies and reducing discretionary spend.
Newton-King said the JSE is refreshing its IT operating structure to align to best practice. “At the same time, our large dependency on IT requires that we look at using technology in a more agile manner to support the execution of our business strategy.”
“If we want to create a building block for future growth we must take some early decisions and there are none tougher than those that involve our people. We looked at all avenues before considering this action. While we appreciate this will be a very difficult time for the affected employees, the newly aligned company will be in a strong position to serve its current and future clients more effectively.”
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