The largest American banks have been quietly laying off workers all year — and some of the deepest cuts are yet to come. Even as the economy has surprised forecasters with its resilience, lenders have cut headcount or announced plans to do so, with the key exception being JPMorgan Chase, the biggest and most profitable U.S. bank.

Pressured by the impact of higher interest rates on the mortgage business, Wall Street deal-making and funding costs, the next five largest U.S. banks have cut a combined 20,000 positions so far this year, according to company filings.

The moves come after a two-year hiring boom during the Covid pandemic, fueled by a surge in Wall Street activity. That subsided after the Federal Reserve began raising interest rates last year to cool an overheated economy, and banks found themselves suddenly overstaffed for an environment in which fewer consumers sought out mortgages and fewer corporations issued debt or bought competitors.

“Banks are cutting costs where they can because things are really uncertain next year,” Chris Marinac, research director at Janney Montgomery Scott, said in a phone interview.

Job losses in the financial industry could pressure the broader U.S. labor market in 2024. Faced with rising defaults on corporate and consumer loans, lenders are poised to make deeper cuts next year, said Marinac.

“They need to find levers to keep earnings from falling further and to free up money for provisions as more loans go bad,” he said. “By the time we roll into January, you’ll hear a lot of companies talking about this.”

Banks disclose total headcount numbers every quarter. While the aggregate figures mask the hiring and firing going on beneath the surface, they are informative.

The deepest reductions have been at Wells Fargo and Goldman Sachs, institutions that are wrestling with revenue declines in key businesses. They each have cut roughly 5% of their workforce so far this year.

At Wells Fargo, job cuts came after the bank announced a strategic shift away from the mortgage business in January. And even though the bank cut 50,000 employees in the past three years as part of CEO Charlie Scharf’s cost-cutting plan, the firm isn’t done shrinking headcount, executives said Friday.