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The investment-banking division of Goldman Sachs has seen a storm of layoffs, in one of the earliest signs of how a falling deals market and a slowing economy are causing pain for Wall Street.

It's been "a tough week," one Goldman insider said of the sackings.  

Several senior associates and vice presidents working for the technology, media, and telecommunications team in New York and San Francisco were laid off,  according to a person with knowledge of the layoffs. At least some of the axed TMT employees worked on mergers and acquisitions, the person added.

"It's a balancing act. You can't cut too many of the senior bankers because even though they are costly, they are the one who bring in more business," this person explained. "And junior bankers, yes they're cheaper, but if the overall business is slow, they don't have much work to do."

A Goldman spokesperson said: "Every year globally we conduct a strategic assessment of our resources and calibrate headcount to the current operating environment. We continue to remain flexible while executing against our strategic growth priorities." 

Roughly 12 TMT bankers were let go — six in New York and six in San Francisco, the person familiar with that team said. The spokesperson disputed that figure, saying that the number was "high."

After reporting a 41% decline in year-over-year investment banking revenues in July, Goldman's CFO Denis Coleman said the bank would return to its practice of culling low performers.

The return to layoffs will surely spook Wall Street talent, especially those just starting.

"I've been doing this for years. It's happened before. And it's going to happen again," a Goldman banker told Insider of the layoffs. "It's a combination of a bad year, so there's less money to pay people, so you need fewer people."