By Edward Krudy
NEW YORK, March 12 The average bonus on Wall
Street jumped 15 percent last year to the highest level since
the 2008 financial crisis and was the third largest on record,
New York State's budget watchdog said on Wednesday.
The cash bonus pool swelled to $26.7 billion in 2013,
pushing the average cash bonus to $164,530, a post-2008 high in
a industry shrunk by the financial crisis, according to the New
York state comptroller's annual estimate.
The increased payouts came as Wall Street posted a fifth
consecutive year of profits after record losses during the
crisis. Profits for broker-dealer operations of New York Stock
Exchange member firms, however, fell 30 percent to $16.7 billion
in 2013, the report said.
"Wall Street navigated through some rough patches last year
and had a profitable year in 2013. Securities industry employees
took home significantly higher bonuses on average," Comptroller
Thomas DiNapoli said in a statement.
The comptroller's report provides early hard estimates of
the bonus pool for security industry employees in New York City
during the traditional December-to-March bonus season.
The estimate is not an exact view of 2013 bonuses because it
reflects cash bonuses and deferred pay from which taxes have
been withheld. The estimate does not include stock options or
other forms of deferred compensation. Bonuses paid to employees
outside New York City are not included in the estimate.
The comptroller's office compiles estimates on Wall Street
bonuses because of their importance to state and city tax
revenues. The report estimates that New York City gained $3.8
billion in taxes from the securities industry in fiscal year
2013, 27 percent more than in the previous year and the second
highest level on record.
It also estimates that city tax revenues could be $100
million higher than forecast in the city's budget because the
budget assumed a 5 percent decline in the bonus pool.
The securities industry accounted for 8.5 percent of the
city's tax revenues during the 2013 fiscal year, below its peak
of 11 percent prior to the 2007-2009 recession.
New York state collected $10.3 billion in taxes from Wall
Street during the financial year, accounting for about 16
percent of all state tax revenues. That compares to 20 percent
before the recession.
Regulation in the securities industry has gone through major
changes since the financial crisis, with firms deferring more
bonuses. Over the last two years the bonus pool has jumped 44
percent, lifted by compensation deferred from prior years, the
The crisis also led to a significantly smaller securities
industry in New York. The report estimates the industry employed
165,200 workers at the end of 2013, 12.6 less than before the
crisis. DiNapoli said that employment in the industry has likely
Bonuses in the financial industry have been a highly
contentious issue since the financial crisis. Bill de Blasio,
New York City's first Democrat mayor in twenty years, took
office this year after campaigning on income inequality.
The average salary in the securities industry, not including
bonuses, was $360,700 in 2012, the latest year for which data is
available. That was more than five times higher than the average
$69,200 salary for other private sector jobs, the report said.
Wall Street accounted for 22 percent of private sector wages
in New York City in 2012 but only 5 percent of private sector
jobs, according to the report.
The Institute for Policy Studies, a left-leaning think-tank,
pointed out that Wall Street's $26.7 billion bonus pool would be
enough to more than double the pay of all the federal minimum
wage workers in the United States, who number over a million.