The bonus pool for Wall Street employees fell 6% to $25 billion in 2015, said estimates released Monday by the office of New York state Comptroller Thomas DiNapoli.
The average bonus paid to securities industry employees declined 9% to $146,200 in 2015 as profits declined 10.5% to $14.3 billion during the year, the lowest level since 2011 and the third consecutive year of profit declines.
The estimate does not include bonuses paid to employees outside of New York City and does not distinguish between cash bonuses for the current year and compensation deferred from previous years. Securities industry profitability is measured by pre-tax profits of the broker-dealer businesses of the New York Stock Exchange.
“Wall Street bonuses and profits fell in 2015, reflecting a challenging year in the financial markets,” Mr. DiNapoli said in a news release. “While the cost of legal settlements appears to be easing, ongoing weaknesses in the global economy and market volatility may dampen profits in 2016. Both the state and city budgets depend heavily on the securities industry and lower profits could mean fewer industry jobs and less tax revenue.”
The industry does not break out legal settlement costs from other non-compensation expenses. However, non-compensation costs, excluding rent, communication and other major operational expenses, were down 6% in 2015, suggesting falling legal settlement costs.
Employment on Wall Street grew 2.7% in 2015 to 172,400 jobs on average, with 4,500 jobs added last year vs. 2,400 in 2014, marking the first time since the 2008 financial crisis that jobs have been added two years in a row. However, the industry is still 8% smaller than it was before the 2008 financial crisis.
In 2014, the average salary, including bonuses, for Wall Street employees rose 14% to a record $404,800, compared to $72,300 in the rest of the city’s private sector. Data for 2015 are not yet available.