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Citigroup's plan to cut 11,000 jobs is far from the first bigdownsizing Wall Street firms have executed since the 2008 financialcrisis. And it won't be the last.

The nation's third-biggest bankis the latest in a series of financial institutions to cut large numbersof jobs. Behind the cuts is new CEO Michael Corbat's push to improveCiti's performance - and free up cash flow so it can boost its paltrystock dividend, currently just a penny a share. But Citi, like itsrivals, also faces pressures from new international regulations thatwill require banks to boost their capital to protect against futurecrises and new U.S. regulations flowing from the Dodd-Frank Act that aredesigned to limit banks' risk-taking.

Indeed, while Citi's newsWednesday isn't likely to set off a short-term wave of layoffs, it'spart of a broader trend toward an economy that depends much less on thefinance industry for jobs and growth than it did before 2008, analystssay. Since the job market bottomed out in 2010, finance has added only94,000 of the 5 million net new private-sector jobs, according togovernment data. Before the recession, finance accounted for nearly 6%of private-sector jobs and 22% of the value of the Standard & Poor's500-stock index.

"We're moving from an economy where we packagefinancial products to one where we build more things, like products androads,'' said Nancy Bush, a banking analyst at SNL Financial. "Consumershave reduced their debt, governments will reduce their borrowing, Asthat happens, everything driven by the financial economy will shrink.Whether people like it or not doesn't matter.''

In Citi's case,the moves were overdue, said Michael Mayo, an analyst at CreditAgricole, a persistent Citi critic who this week recommended its sharesfor the first time in years.

Citi's specific problem is it isunder-profitable even by the standards of post-crisis banks, Mayo said.It has been less than half as profitable as rival JPMorgan Chase in thelast 12 months. Corbat, who took over when Citi dismissed hispredecessor, Vikram Pandit, in October, is the first Citi CEO in yearsto deal aggressively with the bank's high overhead, Mayo said.

"CEOs1 through 4 couldn't get it right,'' Mayo said, cracking wise aboutCiti's executive turnover since Sandy Weill left the top job in 2003. "Ididn't think CEO No. 5 would be any better.''

Citi's cuts hadlittle directly to do with the changing rules. The bank has madeprogress toward meeting future capital standards that will phase in nextyear through 2019. Its capital base has grown 20% so far this year,leaving a cushion of cash and securities worth 8.6% of its risk-adjustedassets (mostly outstanding loans and trading positions) to guardagainst future losses, Chief Financial Officer John Gerspach said at aninvestor conference sponsored by Goldman Sachs Wednesday.

Morethan half of the jobs Citi will cut are in information technology andother support areas, Citi said. Other cuts included selling or shrinkingthe bank's consumer businesses in offshore markets, including Pakistan,Paraguay, Romania and Turkey. Sticking with its strategy to focus on150 cities globally where it sees the greatest potential growth inconsumer banking, Citi also will close 84 branches worldwide, including44 in the U.S.

These decisions have little direct relationshipto either Dodd-Frank or the new capital rules. The bank announced noplans to exit, or even significantly shrink, businesses such as tradingthat require Citi to hold more capital in reserve under the new rules.Instead, the bank, which will have more than $71 billion of revenue thisyear, said the cuts would reduce its annual sales by only $300 million,while trimming $900 million in annual expenses.

Citi is not alone among banks in needing to trim fat, RBC Capital Markets analyst Gerard Cassidy said.

"Whenyou look at the top 20 banks in the U.S., their average costs are muchhigher than they need to be if they are going to deliver thereturn-on-equity numbers shareholders demand,'' Cassidy said. The "vastmajority" of banks' costs are personnel, he says.

To pay for thecuts announced Wednesday, Citi will take a one-time charge of $1billion in the fourth quarter and another $100 million in early 2013,Gerspach said.

Investors applauded the moves. Citi's shares rose 6.3% to $36.46.

The cuts will not be the last at Citigroup, Mayo said.

"Thenew CEO isn't working in half measures, but it won't be enough," theanalyst said. "I'd put this in the category of a tremor, and they needan earthquake."

Industrywide, many cuts do reflect changingregulation. And so do the areas where banks and other finance companiesare looking to hire people.

Banks are shedding staff in areassuch as trading and parts of investment banking that require a lot ofcapital, said Constance Melrose, managing director for North America ofeFinancialCareers, an online marketplace for companies and recruiters tofind finance pros.

At the same time, they are looking to beef upstaff in businesses that don't chew up capital - and in fields such asinformation technology and risk management that will let them run moreautomated trading operations with fewer people as well as less risk, shesaid.

Banks worldwide have announced as many as 300,000 job cutssince the start of 2011, according to data compiled by Bloomberg News.

Thenumber of positions open in October in hedge funds dropped 42% from ayear ago, with 30%-plus drops in currency trading, stock research andmergers. At the same time, companies are looking for 48% more privatebankers, because wealth management is a fee-based low-risk business,Melrose said. Overall, listings for financial professionals are down 21%in the last year, Melrose said.

"It would be silly to say hiringisn't soft, but it's not uniform," Melrose said. "Anything that involvestaking balance-sheet risk is drawing more scrutiny, and that translatesinto where you put your people.''

Some cuts are also happeningbecause regulators are pushing back against banks' desires to raise feesin order to offset lost trading and other revenue, Cassidy said.Regulators have forced banks to lower their fees for processing debtcard transactions, for example.

One way regulators may have helpedcause Wednesday's cuts was when the Federal Reserve quashed Citi'splans to boost its dividend. In April, the Fed announced that Citididn't have enough capital to both increase its dividend and survive asevere recession that would push loan losses higher.

Wednesday,Gerspach said Citi wants to generate "considerable excess capital forreturn to shareholders,'' but he didn't give a timetable for anydividend hike.

For the economy, the new regulations and thesmaller financial sector they produce will be a mixed bag, said PaulEdelstein, financial economist at consulting firm IHS Global Insight.

"It'sbad in the sense that it will be harder to get access to credit,"Edelstein said. "And it will be a good thing if it means we don't havefinancial crises any more. There are trade-offs to this."

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