Barclays CEO: job cuts driven by AI, calls it ‘icing on the cake’
Kalyeena Makortoff
The 5,000 job cuts are part of a wider cost cutting drive that Barclays bosses said has been driven by advances in artificial intelligence.
The majority (60%) affect support roles.
The job cuts will mean getting rid of about 5% of the bank’s 93,000 global staff.
The bank’s chief financial officer, Anna Cross, told reporters that it was part of plans to save more than £1.1bn in 2027.
These actions involve an expected reduction of circa 5000 full time employees, around 60% of the group actions relate to support functions, including theory developers. AI makes our people more productive.
When asked how many of the total job cuts would be directly linked to AI, chief executive CS Venkatakrishnan said the bank had been making “deep investments” in technology and simplifying its processes.
That is driving the bulk of the efficiency gains that you’ve seen so far. AI has an important role to play and may have a more important role to play in the future.
He called AI the“icing on the cake” to modernising the bank’s technology.
We have been focusing on the infrastructure build, and where the infrastructure is modern, we’ve been applying AI.
The news comes months after another UK-headquartered bank, Standard Chartered, announced plans to cut more than 7,000 jobs over the next four years as it ramped up the use of AI. It will mean slashing around 15% of its back-office roles by 2030.
Key events
Save high street by taxing online sales at higher rate, Burnham urged
Andy Burnham has been urged by one of his most senior former advisers to tax internet sales at a higher rate than those in physical shops to help “level the playing field” for struggling high streets.
As the prime minister and his chancellor, John Healey, prepare for their first budget next week, Andy Haldane joined calls for them to take action to stop the shutters coming down on growing numbers of shops across the UK.
In an interview for a Guardian series looking at how Britain can reverse the declining fortunes of towns, the former Bank of England chief economist urged them to launch a realignment of the tax system away from favouring online sellers, alongside a review of business rates and measures to turbocharge devolution.
Meta strikes deal with Zuckerberg to protect him from California wealth tax
Meta has struck a deal with Mark Zuckerberg to protect him from the threat of a California wealth tax targeting billionaires.
The social media company behind Facebook, Instagram and WhatsApp revealed on Wednesday night that the arrangement would keep its chief executive living in California, where its headquarters are located.
Under the deal, Zuckerberg will receive new shares that could be sold to potentially foot a multibillion-dollar tax bill in the event that California passes a one-off billionaire tax. In return, he is committed to remain a resident of the state, or wherever Meta maintains its base, for eight years
Californians will vote early next month on Proposition 40 – a one-time 5% tax on the roughly 250 billionaires who live in the state.
Lunchtime summary: French bond yields jump as oil prices hit five-month high
Time for a summary.
Investors are demanding a similar risk premium to buy France’s 10-year government bonds against safe-haven German Bunds to 2011 during the eurozone debt crisis.
The spread between bonds of both countries reached more than 173 basis points today, the widest since November 2011, although still below the 200bps seen at the height of the global financial crisis.
The yield, or interest rate, on the benchmark French 10-year government bond is up 11.5bps at 5.1%, after rising as high as 5.1415%, its highest since July 2002. It breached 5% for the first time on Wednesday.
The French 10-year yield also rose above that of the equivalent US Treasury bond for the first time today, as US Treasury yields declined.
Giada Giani, an economist at Citi, said:
There exists a consensus that Europe is better equipped today to deal with crises, and that European institutions are stronger today than they were 15 years ago, which should make a European response easier to put together.
But re-emerging euroscepticism is a constrain here.
Bonds are under pressure from rising inflation, with concerns stoked by a jump in oil prices today, as well as worsening government finances and persistent street protests over the cost of living and other grievances in France and Italy.
Oil prices jumped to a five-month high after attacks in Saudi Arabia and hits to tankers in the strait of Hormuz threatened further disruptions to the world’s crude supply.
Brent crude, the international benchmark for oil prices, rose more than 3% above $112 a barrel for the first time since 18 May. It is now trading at $111.85 a barrel, up $3.05 on the day, a 2.8% gain.
Yemeni Houthis, who are aligned with Iran, hit several targets in Saudi Arabia on Wednesday, with two people killed and eight more wounded in a civilian airport in Dammam, and two people killed in a drone attack on a Saudi oilfield.
Spot gold has fallen nearly 2% to $4,063 an ounce.
A closely-watched survey showed an improvement in French business confidence in early October, but it did not capture the recent protests, with more planned for Saturday.
A divided French parliament is struggling to pass the annual government budget plan for next year, needed to keep a lid on its ballooning budget deficit and growing public debt pile.
Analysts at Goldman Sachs think the budget wrangling could well last into December, and the annual budget gap could hit 6.4% of GDP. Even if the government can get its €54bn savings package through, the deficit will still amount to 5% plus of GDP for the third consecutive year and push total debt above 120% of GDP for the first time — second only to Italy in the eurozone.
Barclays is cutting 5,000 jobs as part of wider cost-saving plans that its bosses say are being driven by advances in AI.
The job cuts will mean losing about 5% of the bank’s 93,000 global staff, with executives confirming they had already cut 1,000 workers since the start of the year.
The bank’s chief financial officer, Anna Cross, told reporters that the job cuts were part of plans to save more than £1.1bn in 2027.
These actions involve an expected reduction of circa 5,000 full-time employees. Around 60% of the group actions relate to support functions, including fewer developers, as AI makes our people more productive.
Maritime and port workers: how is the Middle East conflict affecting you?
The conflict in the Middle East continues to disrupt shipping across the region, including in the strait of Hormuz, one of the world’s busiest maritime routes.
Iran state TV has reported that seven oil tankers were damaged in the Straight of Hormuz on Wednesday night. There has been an increase in the number of attacks on ships in recent days; some vessels have been hit by drones, others by mines.
We would like to hear from maritime workers, port staff and shipping crews or families aboard ships affected by the conflict. What is happening in the Strait of Hormuz? How is the situation affecting your work? We would also like to speak to friends or family of those on board. What are you hearing? How are they coping?
John Healey says helping entrepreneurs will be a budget priority
A week today John Healey, the chancellor, will be doing a media round defending the budget he is presenting on Wednesday next week.
Ahead of that, he has given an interview to Patrick Maguire from the Times. As you would expect, there is no real detail in it about the measures he will be presenting to MPs.
But the big picture message is very clear – and quite surprising, coming from a chancellor serving a PM who in some respects is steering left compared to his predecessor, writes the Guardian’s political correspondent Andrew Sparrow.
Healey says that he wants to be on the side of bloody-minded entrepreneurs who make a profit, he acknowledges that government has made their life harder over the past two years, and he suggests that cutting the ‘cost of living’ for business is just as important as cutting the real cost of living for families.
In the quote that gives the Times its splash headline, Healey says:
I want to be a chancellor who backs business in Britain making a profit, and those entrepreneurs who, in the end, are the ones who challenge the status quo, come up with innovative ideas and are trying, some of them through sheer bloody-mindedness, to keep going through these sorts of pressures …
If you’re not making a profit, you’ve got nothing to put back into the business. And for the people who start up these businesses, the ones who really thrive and grow, they have to make a profit — and they will be much more inclined to put it back into their own business. But we want it to grow here and stay here.
You can follow the latest on our politics live blog with Andrew Sparrow here:
Sainsbury’s says households ‘finding it tough’ in run-up to Christmas
Sarah Butler
Sainsbury’s has warned of a “pretty challenging” market in the run-up to Christmas as households are “finding it tough” and food producers face rising costs.
Simon Roberts, the chief executive of the UK’s second biggest supermarket, called on the government not to “further aggravate” pressure on costs for business in this month’s budget.
He said it was “important this government does not repeat what we have seen in previous budgets” in raising business rates and employers’ national insurance contributions. “That’s been really hard,” he said.
After Sainsbury’s and other industry leaders met government ministers last week, Roberts said he believed “this government is really listening to business” especially on helping to create more jobs for young people.
Roberts added that food inflation was not “anything like” some of the high levels forecast earlier in the year but suggested high energy and fertiliser costs could push up food prices next year.
Roberts added that in a more unsettled global environment the UK needed to “improve food resilience and grow and produce more at home”. He called on the government to increase tax breaks that support investment in technology – including irrigation and reservoirs – on farms as the climate crisis is expected to lead to more hotter, drier summers such as this year’s.
Shares in Sainsbury’s slid 3.7% as the retailer revealed slower than expected sales growth of 2.6% in the six months to 12 September, with growth almost halving to 1.9% in the second quarter from 3% in the first. Strong online grocery sales – up 9% – and a 6% rise in sales of the retailer’s premium own-label Taste the Difference range helped with growth.
Roberts said sales had slowed as shoppers had kept a tight rein on the number of items they bought amid a “focus on the cost of living” and had reined in spending on clothing and “big-ticket” items, such as furniture, at Argos. Sales at the catalogue shop were down 1.8% and Sainsbury’s general merchandise and clothing sales were down 3.4% in the half.
Barclays boss backs UK chancellor over expected bank tax hikes
Kalyeena Makortoff
Barclays’ CEO seems to have admitted defeat over bank tax hikes, which are expected to be a headline measure in John Healey’s budget next Wednesday.
When asked whether the bank might consider tilting assets or investment out of the UK and to the US – where it also has operations – as a result of higher taxes , Barclays chief executive CS Venkatakrishnan gave his full backing to the chancellor.
He told reporters:
I recognise that the chancellor and the government has been entrusted with an important duty by the public and the people. And they have to balance a host of considerations. He [Healey] is the man in the arena, and I deeply respect the responsibility he bears on his shoulders and wish him well.
His long term goal is the same as our long term goal, which is to get growth.
Second, we are already a bank, which makes, effectively, half of our money elsewhere [ outside] the UK. And so this is not a question of a financial hit to us. It’s bearable. It is a question of proportion and it’s a question of market signaling. But as I said, I deeply respect the responsibility that the chancellor has and he has our full support and backing.
Bank bosses have been lobbying intensively against bank tax rises since narrowly escaping higher levies during last year’s budget.
That includes JP Morgan boss Jamie Dimon, who said earlier this year he could scrap plans for a new £3bn London headquarters if the UK government became hostile to banks. News of the tower – which will house more than half of its 23,000 UK staff – was unveiled just days after former Labour chancellor Rachel Reeves spared the sector of further tax rises in her 2025 autumn budget.
Lorry drivers’ blockades bring southern Italy to standstill
Lorenzo Tondo
French president Emmanuel Macron isn’t the only European leader to be holding emergency meetings.
As lorry drivers’ protests bring much of southern Italy to a standstill amid food and fuel shortages, with businesses warning they are on the brink of collapse, Italian authorities have launched a police crackdown on road blockades, reports our man in Palermo, Lorenzo Tondo.
The interior ministry said on Wednesday that 1,339 protesters had been identified, 71 reported to judicial authorities and 242 fined over what it described as “illegal road blockades”. Police escorted hundreds of vehicles carrying goods, including 500 in Campania alone, while the interior minister, Matteo Piantedosi, warned of possible infiltration by criminal groups.
Industry associations in Campania and Puglia warned that businesses were on the brink of collapse, prompting the prime minister, Giorgia Meloni, to convene an emergency cabinet meeting.
Industry associations representing Naples and other parts of Campania and Puglia said in a joint statement:
The truckers’ dispute requires an immediate response. Production has ground to a halt due to a lack of supplies. The strike must end; otherwise, the damage to consumers and businesses, which is already significant, will become unsustainable.
The protests began last week, with lorry drivers blocking roads and slowing traffic across the country, particularly in the south, following strikes and sit-ins by farmers and fishers.
The disruption has left supermarket shelves empty in several regions, with photographs showing entire aisles stripped of goods. Stocks at some supermarket chains have reportedly fallen to 50% of normal levels.
Italy’s air traffic management agency, ENAV, said on Wednesday that Crotone and Reggio Calabria airports had run out of jet fuel because of supply disruptions.
According to estimates gathered by Confcommercio Sicilia, the five-day disruption to freight transport has caused between €40m and €50m in losses in Sicily alone, affecting supermarkets and the wider fresh food supply chain.
The protests threaten to deepen the crisis facing Meloni’s government, which is struggling to contain the unrest. Measures announced so far by Rome appear to have done little to appease lorry drivers, prompting the government to take the controversial step of attempting to quell the protests through a police crackdown.
The ongoing protests in France create a vicious circle, ING’s senior economist Charlotte de Montpellier warned.
The yield on 10-year French government bonds OATs has crossed the symbolic 5% threshold, while the spread over the German Bund has widened beyond 160 basis points, from 137bps last Friday.
These moves reflect both growing doubts about the ability of any future government to pass the necessary reforms and savings measures, and mounting concerns about the outlook for the French economy.
At the same time, the renewed deterioration in financial conditions is further weakening an already very poor growth outlook by increasing the cost of credit.
ING is forecasting GDP growth of just 0.3% in 2026 and 0.6% in 2027, but the risks are tilted towards another downward revision. De Montpellier added:
Against this backdrop, the government’s objective of reducing the deficit to 5% of GDP in 2027 looks particularly fragile, as it is based on growth of 0.5% in 2026 and 1% in 2027, well above our forecast. Even if the draft budget were adopted in full, it might therefore not be enough, as weaker activity would automatically reduce the expected tax revenues.
French business confidence improves but unrest clouds outlook, with more protests planned
French business confidence unexpectedly improved in October, but this does not capture the impact of the latest social unrest, while higher interest rates, a weak labour market and worsening public finances are clouding the outlook further.
A closely-watched business confidence index edged up by one point to 97, but remains below its long-term average.
The main surprise came from industry. The manufacturing business climate index rose to 105 in October 2026, above market expectations and 101 in September, marking its highest level since July 2022. The improvement was driven mainly by overall order books, although they stayed negative (-11 vs -16 in September) and foreign order books (-1 vs -10), with the latter reaching its highest level since April 2022.
In the services sector, the business climate indicator rose one point to 99.
On prices, Charlotte de Montpellier, senior economist covering France and Switzerland at ING, noted that the survey provided no new inflationary signal. Intentions to raise prices declined in industry and remained stable in both services and construction. The employment climate indicator fell three points to 95, as hiring intentions worsened in the services sector.
The rebound is encouraging, especially after several months of disappointing industrial data. But it does not fundamentally alter the outlook. The indicator of perceived economic uncertainty rose sharply. In services, it even reached its highest level outside the Covid-19 crisis.
The survey was conducted between late September and early October. It captures the widening in French bond spreads, but not the violence and social unrest seen last weekend. “October’s rebound is encouraging, but fragile and already partly overtaken by events,” de Montpellier said.
The nature of the risk has changed. It no longer relates only to weak activity and the impact of higher interest rates, but also to the economic, political and financial consequences of social unrest.
The economic cost of the violence is not limited to broken shop windows and looting. Material damage represents only the most visible part of the bill. Closures, lower footfall and permanently lost sales could weigh far more heavily on activity.
But the real issue is persistence. A brief and localised episode would probably have a limited macroeconomic impact, while prolonged unrest could undermine confidence by encouraging households to avoid city centres, tourists to postpone their trips and businesses to delay investment. This could turn a temporary disruption into a more lasting economic shock.
The unrest also makes it even more difficult to secure parliamentary approval for the budget, at a time when the government has virtually no room to respond through additional spending or tax cuts. France therefore has neither the fiscal room to buy social peace nor the political room to impose the necessary adjustment easily.
More protests are planned this weekend, and the French president Emmanuel Macron – back from his tour of the Gulf – is hosting a security council meeting to try and put out the fires at home.
We’ve launched a fun (??) game – you can pretend to be the UK chancellor and play the budget game to see if you can balance the books.
See if you can do a better job than John Healey at creating a budget that keeps MPs and the bond markets onside.
