Compensation on Wall Street continued to march upwards in 2013, according to government data, with the average bonuses growing 15% from the year before.
The typical employee in New York City’s securities industry took home $164,530 last year—on top of his or her $191,000 salary. A report from the state comptroller’s office on the sector’s pay showed bonuses have reached a post-financial crisis high. Last year’s incentive checks were the third largest on record, following the pre-crash heyday of 2006 (averaging about $190,000) and 2007 ($175,000).
The comptroller’s office predicted traders, brokers, and investment bankers would have an even better year in 2014.
As compensation has climbed over the past few years, profits from the industry’s traditional revenue engine—trading—have dropped off.
But the demise of proprietary trading desks has been countered by a massive jump in asset management fees. Revenue from this branch increased by more than 73% between 2010 and 2013, the comptroller found. In the first half of 2014, asset management revenue climbed another 15%.
Underwriting activities likewise grew 20% over the same period and yielded record income for broker/dealer operations last year.
Bonuses aside, Wall Street has demonstrated signs of restraint through the rebound. “Job growth in the securities industry in New York City has been much weaker during the current economic recovery than it was during past recoveries,” the report noted. “During the comparable periods after the 1990 to 1992 and 2001 to 2003 recessions, the industry accounted for about 11% of private sector job gains.”
Thus far, the securities business has not contributed to post-2008 job growth in the city.
Where these firms have made contributions is to state coffers. New York collected more in taxes from the securities industry during the last fiscal year than any other on record, including 2007 to 2008. Between corporate and personal income taxes, the state reaped $13.2 billion from the sector.
The comptroller anticipated another $4.5 billion from one-time settlements and fines will roll in from Wall Street next year.
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