In all, securities firms in New York made an estimated $13.5 billion in 2011, down sharply from $27.6 billion in 2010, according to the comptroller’s estimates. It is the second consecutive year that Wall Street’s profit fell by more than half.
Despite the difficult environment, New York firms paid roughly $20 billion in year-end cash compensation to their employees. The average bonus was $121,150, down just 13 percent from the year before as the head count shrank. In 2006, the year before the financial crisis, the average investment bank employee took home a bonus of $191,360.
Still, a dip in year-end cash compensation is cause for concern for New York government officials. Before the financial crisis, Wall Street accounted for 20 percent of the state’s tax revenue. Last year, that tally was 14 percent. For New York City, the share dropped to 7 percent of tax revenue from 13 percent over the same period.
“The city budget is dependent on a very small group of people — the 1 percent, if you will,” said Nicole Gelinas, a senior fellow at the Manhattan Institute. “If the 1 percent isn’t doing well, the city’s not doing well.”