New York state Comptroller Thomas DiNapoli predicted Friday that Wall Street profits for this year are expected to exceed those of 2015, representing the first increase in securities industry earnings since 2012.
“Barring a major setback,” New York City's securities industry profits are on a pace to beat the $14.3 billion in profits last year, Mr. DiNapoli said in a telephone news conference that coincided with the release of his office's report on Wall Street's impact on the city economy.
“We don't see anything on the horizon that causes concern,” said Mr. DiNapoli, who is sole trustee of the $181 billion New York State Common Retirement Fund, Albany.
He predicted higher full-year profits in 2016 even though securities industry profits of $9.3 billion in the first half of 2016 were 18% below the $11.3 billion in first-half 2015 profits. The $9.3 billion figure is “still a solid first half by historical standards,” said Mr. DiNapoli, adding that 2015's results were affected by a “small loss” of $180 million in the fourth quarter,
Securities industry profits are traditionally measured by the pre-tax profits of broker/dealer operations of New York Stock Exchange member firms, said the Wall Street report by the comptroller. “Other business lines of the member firms, such as retail and commercial banking, are not included,” the report said.
Although the New York City securities industry added 2,400 jobs in 2014 and 4,500 in 2015, Mr. DiNapoli said it was unclear if there would be an overall gain this year. In August, there were 172,400 jobs — seasonally adjusted — vs. 175,000 in March. “Despite the recent decline, the industry may still post a small employment gain in 2016,” said the comptroller's report.
The report noted the changing impact of the securities industry on New York City's economy, having dropped 8% of its jobs between 2007 and 2015 while the rest of the city's private-sector employment rose by 17%. The securities industry accounted for less than 5% of New York City jobs last year, but it represented 21% of all private-sector wages.
The full report is available on the comptroller's website.