British banking giant Barclays has announced plans to cut about 5,000 jobs in 2026 as it increases its use of artificial intelligence (AI) to reduce operating costs, despite reporting a 12 per cent increase in quarterly profits.
The job cuts, representing approximately five per cent of the bank’s global workforce, come as financial institutions increasingly turn to automation and digital technology to improve efficiency.
Barclays confirmed the decision on Thursday, October 22, with around 1,000 positions already removed during the first half of the year. A further 4,000 jobs are expected to disappear before the end of December.
The bank’s chief financial officer, Anna Cross, confirmed the timetable as Barclays outlined its cost-cutting plans alongside its latest financial results.
The announcement raises fresh concerns about the future of employment in the banking sector, particularly as AI systems become increasingly capable of carrying out tasks previously handled by employees.
Barclays cuts jobs as profits increase
The reductions come at a time when Barclays is reporting stronger financial performance.
The bank recorded a 12 per cent rise in quarterly profit to approximately £2.3 billion, highlighting the contrast between its financial results and plans to reduce its workforce.
Barclays is continuing a wider programme to simplify its operations, reduce expenses and improve returns for shareholders.
Chief executive C.S. Venkatakrishnan linked the workforce reductions to investments in technology made over several years, including systems designed to improve productivity and automate routine processes.
The bank sees technology as an important part of its efforts to operate more efficiently while maintaining services for customers.
However, the announcement also raises questions about how businesses should balance technological progress, profitability and job security.
For workers facing redundancy, stronger company earnings do not necessarily translate into greater employment stability.
Developers and support staff among affected workers
The job reductions are expected to affect several areas of Barclays’ operations, including technology and administrative functions.
According to Reuters, Cross said approximately 60 per cent of the cuts would involve support functions, including software developers.
That means about 3,000 of the 5,000 positions could be lost across these functions, although the bank has not publicly provided a complete breakdown of affected departments or locations.
The inclusion of software developers is particularly significant because technology jobs have traditionally been considered among the beneficiaries of digital transformation.
However, advances in AI are changing how banks develop software, process information and manage internal operations.
How Barclays is using artificial intelligence
Barclays has already begun expanding its use of AI across its business.
On October 1, the bank announced an expanded partnership with US technology company Anthropic, the developer of the Claude AI system.
Under the arrangement, Barclays is introducing AI tools to support software development, modernise older computer systems and improve customer services.
The bank expects its Claude Code technology to be adopted by half of its software developers by the end of 2026, with most developers expected to use the technology in 2027.
AI is also being used to help employees find information when responding to customers.
According to Anthropic, more than 16,000 Barclays employees have adopted an AI-powered knowledge assistant, which has handled over one million searches.
In another part of the business, AI technology helps process approximately 120,000 emails daily, reducing the need for manual handling and helping employees prioritise customer requests.
What the job cuts mean for the future of banking
The announcement highlights the changing relationship between technology and employment in the financial services industry.
Banks have long used technology to process transactions, detect fraud and manage customer accounts. However, newer AI systems can also assist with software development, document analysis, information retrieval and administrative work.
These capabilities could allow banks to complete certain tasks with fewer employees.
Nevertheless, it remains unclear how many of the 5,000 Barclays job reductions can be attributed directly to AI rather than broader restructuring and cost-saving measures.
The changes also raise questions about whether affected employees will have opportunities to retrain or move into other positions.
For financial institutions, the challenge will be to adopt technologies that improve productivity without weakening customer service, operational security or confidence among employees.
Barclays has presented its technology investments as part of a longer-term effort to modernise operations and improve efficiency.
For thousands of employees, however, the immediate concern will be the future of their jobs as the bank completes its restructuring programme before the end of 2026.
The development also adds to the wider debate about whether the rapid adoption of artificial intelligence will create enough new employment opportunities to offset jobs displaced by automation.
Read related news:
London leads UK finance hiring boom in 2026
Barclays beats first-quarter forecasts as Trump turmoil supercharges trading
“Without music career, I will succeed in entertainment” – Davido
