Bank of Canada to Cut 10% of Staff as Carney Hunts Savings
(Bloomberg) — The Bank of Canada plans to cut hundreds of jobs, about 10% of its workforce, as Prime Minister Mark Carney aims to cut government spending.
About 225 employees at the central bank will be affected, according to a memo seen by Bloomberg News. It was stated that the cuts would take place “over the next few months” and be completed by June.
In the memo, the bank said it had already reduced non-salary budgets, closed job openings and expanded early retirement options for employees. However, this will not be enough to achieve the 10% budget cost savings the bank has committed to by the end of 2026.
A spokesman for the Bank of Canada said the agency would honor Carney’s request to save money, as it has done with similar programs in the past.
The central bank has committed to reducing the total budget by 15% in the 2026-2028 period, spokesman Paul Badertscher said in an emailed statement. “There are cuts across all departments,” he said. “We will make sure the bank can continue to deliver on its mission for Canadians.” he said.
The number of people working in the bank has increased since the Covid-19 outbreak. Bank of Canada employment grew from approximately 1,800 in 2019 to 2,350 people by the end of 2023.
The cuts are in line with the Canadian government’s broader spending review. On Tuesday, Finance Minister Francois-Philippe Champagne’s budget included plans to find savings of C$60 billion ($42.5 billion) over the next five years, including reducing the size of the civil service by about 40,000 people.
Of course, the Bank of Canada operates independently and decisions are made by its board of directors. The central bank has previously aligned with the federal government’s spending reduction plans, including during former Prime Minister Stephen Harper’s tenure.
Other Crown corporations, including the Office of the Superintendent of Financial Institutions, have also adapted to planned spending cuts.
At the same time, Carney’s government is giving the central bank new regulatory responsibilities, including oversight of the Consumer Oriented Banking Act.
In the budget, the government said the bank could hold additional remittances to help finance these new projects.
In the note, the bank said it had committed to a further 5 percent reduction in “corporate-level spending” by the end of 2028.
A letter to federal workers from the head of the civil service, Privy Council Clerk Michael Sabia, acknowledged that the planned 40,000 job cuts would “have real consequences for the people who serve their country and their families.” I will not try to minimize these consequences. These are real.”
He also said that achieving C$60 billion in savings would require “reducing a number of programs, limiting the scope of some, and ending others altogether.”
(Context is added starting in the eighth paragraph.)
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