The average bonus paid to employees in the New York City securities industry rose 10% last year to $184,100, said Thomas P. DiNapoli, the New York state comptroller.
"Wall Street's near-record year shattered all expectations," Mr. DiNapoli said in a news release Friday. "The early forecast of a disastrous year for financial markets was sharply reversed by a boom in underwriting activity, historically low interest rates and surges in trading spurred by volatile markets."
This increase in bonuses makes it likely that the city will meet or even exceed its income tax revenue projections for 2021, the news release said.
"Income tax revenue from New York City's securities industry will help shore up state and city budgets that are strained by steep declines in other industries, but it comes with a caution," Mr. DiNapoli added. "New York benefits when Wall Street succeeds, but our economy won't fully recover until other sectors can reopen and all New Yorkers have a chance to share in economic success."
The securities industry accounts for 20% of private-sector wages in New York City, even though it represents less than 5% of private-sector employment, the release said. The comptroller's office estimates that "nearly 1 in 10 jobs in the city are either directly or indirectly associated with the securities industry."
Mr. DiNapoli estimated that the securities industry accounted for 18%, or $13.2 billion, of state tax collections for the state fiscal year that ended March 31, 2020. He also estimated that the securities industry accounted for 6%, or $3.9 billion, of New York City tax collections for the city fiscal year that ended June 30.
The 2020 bonus pool for New York City securities industry workers is estimated to have increased by 6.8% to $31.7 billion during the traditional December-March bonus season.
Pretax profits in 2020 for the broker-dealer operations of New York Stock Exchange member firms — the traditional measure of securities industry profits — rose 81% to $50.9 billion.
"It was the fifth consecutive year of growth in profits, which are up 256% since 2015," the news release said. "Profitability in 2020 was the second highest on record, trailing $61.4 billion recorded in 2009."
In 2020, employment in New York City's securities industry decreased by 1.9%, or 3,600 jobs, to 179,900. Industry jobs decreased by 5% from 2007 and 11% from its peak in 2000.
The comptroller releases an annual estimate of bonuses paid during the traditional December through March bonus season to securities industry employees who work in New York City. Bonuses paid by firms to their employees located outside of New York City — domestic and international locations — are excluded.
The comptroller's estimate is based on personal income tax withholding trends and includes cash bonuses for the current year and bonuses deferred from prior years that have been cashed in. The estimate does not include stock options or other forms of deferred compensation for which taxes have not been withheld.
