P.M. BRIEFING : Merrill Lynch to Restructure, Expects a Number of Layoffs

In another realignment on Wall Street, Merrill Lynch & Co. said today it will restructure and probably lay off an undisclosed number of employees due to intensified competition in a weaker market.

The possible cutbacks at the nation’s No. 1 brokerage house would follow recently announced layoffs at Shearson Lehman Hutton Inc. and Drexel Burnham Lambert Inc.

In a letter to employees today, Merrill said its profitability had not been adequate despite steps taken to cut costs over the last few years.

Merrill said it will further examine its businesses to improve profitability in units that are performing adequately, restructure or cut areas that are not doing well, further cut operating costs, put greater controls on new resource commitments and modify its pay-for-performance system.

Wall Street has been humbled by the realization that the party may be over from the heady go-go days of the early 1980s, when money flowed like water and brokerages hired with abandon.

Since the October, 1987, crash, about 17,000 Wall Street employees have been laid off as securities firms posted lower profits.