NEW YORK: Goldman Sachs Group Inc will cut jobs as early as this month after pausing the annual practice for two years during the pandemic, according to a source familiar with the plans.

The Wall Street giant typically trims about 1% to 5% of its staff each year, and the 2022 cuts will likely be in the lower end of that range, the source told Reuters. The staff reductions may begin as early as next week, the person said.

Goldman's headcount swelled to 47,000 at the end of June, up 15% from a year earlier. A 1% cut to staffing would imply a reduction of about 500 bankers.

The New York Times earlier reported on the upcoming layoffs, citing two people familiar with the plans.

Goldman Sachs declined to comment.

In July, the investment bank had warned it might slow hiring and cut expenses as the economic outlook worsens. It reported a 48% slump in quarterly profit, which beat forecasts due to gains in fixed-income and commodities trading.

The bank will also reinstate its annual performance review for employees at the end of the year, a process it had suspended during the pandemic, Chief Financial Officer Denis Coleman told analysts in July.

With risks of a U.S. recession looming and the Federal Reserve raising interest rates aggressively to stem inflation, prospects for arranging and financing deals have dried up.

"Banks will likely continue to be under pressure to cut costs where they can and layoffs and slowdowns in hiring are quite possible," said Ryan Detrick, chief market strategist at Carson Group.

JPMorgan Chase & Co, Wells Fargo & Co and Citigroup have cut mortgage bankers in recent months as the industry downsizes after having expanded to handle a surge in pandemic demand. (Reporting by Saeed Azhar; additional reporting by Mehnaz Yasmin in Bengaluru; editing by Jonathan Oatis)