Bankers racked up their highest bonuses ever in New York last year, but their good fortune may be running out.
Employees in New York City’s securities industry got extra payouts averaging $257,500 in 2021, up 20 percent from their previous peak a year earlier, according to an estimate by Thomas P. DiNapoli, the state comptroller.
“Wall Street’s soaring profits continued to beat expectations in 2021 and drove record bonuses,” Mr. DiNapoli said in a statement on Wednesday. “But recent events are likely to drive near-term profitability and bonuses lower.”
Markets remain turbulent during the recovery from the pandemic, and Russia’s war on Ukraine only increases the uncertainty of the global economic outlook, Mr. DiNapoli said.
The surge in compensation surpassed the city’s projections and will allow it to raise more income-tax revenue than it expected, even as the pandemic continues to weigh on other industries. “We won’t get back to our pre-Covid economic strength until more New Yorkers and more sectors — retail, tourism, construction, the arts and others — enjoy similar success,” Mr. DiNapoli said.
The 180,000 employees in the securities industry make up only 5 percent of the city’s private-sector work force but account for a fifth of its wages, according to the estimates. One in nine jobs in New York City is connected to Wall Street.
Still, the pay bumps haven’t stopped droves of bankers from changing jobs amid pandemic-inspired ennui, blockbuster profits and fierce competition for talent. Itchy feet have forced big banks to open their wallets: Compensation costs at the nation’s six largest lenders rose 12 percent to nearly $178 billion combined last year.
Source: NY Times