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New York City accounted for less than onefifth of the nations securities industry jobs in
2015, down from 32 percent in 1990.
Report82017|October2016
Regulatory Reforms
Industry Profitability
Report82017
Billions of Dollars
FIGURE 1
Securities Industry Profits
70
60
50
40
30
20
10
0
-10
-20
-30
-40
-50
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
Note: Pretax profits for broker/dealer operations of New York Stock Exchange member firms.
Sources: Securities Industry and Financial Markets Association; NYSE/Intercontinental Exchange
October2016
Employment
The securities industry in New York City lost
33,700 jobs between 2000 and 2003, a period
that included the terrorist attacks on the World
Trade Center and the bursting of the dot-com
bubble. From 2003 to 2007, the industry added
26,600 jobs, but the financial crisis caused the
industry to shed 22,600 jobs between 2007 and
2010. The industry was unable to sustain a
recovery in 2011 and resumed downsizing
through 2013.
The industry added 2,400 jobs in 2014 and 4,500
jobs in 2015, the first time since the financial
crisis that the industry has added jobs for two
consecutive years. Despite the job gains, there
were 8 percent fewer industry jobs in New York
City in 2015 than before the financial crisis.
Industry employment rose until March 2016, but
since then it has declined as the industry sheds
jobs to bolster profitability (see Figure 2). In
August 2016, there were 172,400 employees
(seasonally adjusted) in the securities industry in
New York City, 2,600 fewer than in March.
Despite the decline, the industry is still likely to
post a small net gain for all of 2016 because of
job growth earlier in the year.
FIGURE 2
Securities Industry Employment
Thousands of Jobs
200
175
150
125
100
Aug-16
Apr-16
Dec-15
Aug-15
Apr-15
Dec-14
Aug-14
Apr-14
Dec-13
Aug-13
Apr-13
Dec-12
Aug-12
Apr-12
Dec-11
Aug-11
Apr-11
Dec-10
Aug-10
Apr-10
Dec-09
Aug-09
Apr-09
Dec-08
Aug-08
Apr-08
Dec-07
Aug-07
Area
2015
Level
Change
2010-15
Percentage
Change
2010-15
United States
902.7
102.3
13%
New York
California
Texas
Illinois
Florida
Massachusetts
Pennsylvania
New Jersey
Connecticut
North Carolina
192.1
89.3
63.7
51.0
44.1
44.0
40.2
40.1
25.4
22.2
9.3
10.3
15.7
2.6
4.8
(0.4)
13.4
(7.3)
2.9
5.3
5%
13%
33%
5%
12%
-1%
50%
-15%
13%
31%
Report82017
Bonuses
Like most businesses, financial firms report
compensation (i.e., base salary, fringe benefits
and bonuses, including deferred remuneration)
on an accrual basis of accounting. As such, cash
bonuses paid in January through March of one
calendar year (for work performed during the prior
calendar year) are reported in the prior years
financial statements. For example, most of the
resources that are being set aside for
performance-related compensation in 2016 will
be paid out during the first quarter of 2017.
In recent years, the securities industry has
changed its compensation practices in response
to new regulations and other compensation
reforms designed to discourage excessive risktaking. Firms have raised base salaries for some
employees, and now pay a smaller share of
bonuses in the current year while deferring a
larger share to future years (a minimum of three
years) in the form of cash, stock options or other
types of compensation.
Federal regulators recently proposed rules to
restrict excessive risk-taking by regulating bonus
payments at financial institutions. The rules would
require the biggest firms to defer at least half of
FIGURE 4
Billions of Dollars
35
30
25
20
15
10
5
0
2015
2010
2005
2000
1995
1990
2015
2010
2005
2000
1995
1990
200
180
160
140
120
100
80
60
40
20
0
Note: Bonuses for securities industry employees who work in New York City. Estimates include deferred bonuses that have been realized.
Sources: NYS Department of Labor; OSC analysis
October2016
Average Salaries
The average salary in the securities industry
(adjusted for inflation) declined by 16 percent
between 2007 and 2015, but it was still the
highest by far of any major industry in New York
City ($388,000). Moreover, the gap between the
average salary in the securities industry and in
the rest of the Citys private sector ($74,100) is
much larger today than it was 30 years ago (see
Figure 5).
FIGURE 5
Average Salaries in New York City
Thousands of Dollars
500
Securities Industry
400
2013
2011
2009
2007
2005
2003
2001
1999
1997
1995
1993
1991
1989
1987
1985
1983
1981
Report82017
FIGURE 6
Share of Private Sector Wage Growth
1990-2007
Securities
Industry
39%
Rest of
Private
Sector
61%
FIGURE 7
Share of High-Wage Jobs Added,
2010 to 2015
All Other
12%
Business
Services
34%
Securities
Industry
6%
TAMI
48%
2010-2015
Securities
Industry
11%
Rest of
Private
Sector
89%
October2016
FIGURE 8
Securities Industry-Related Tax Payments
New York City
12
16
14
12
10
8
6
4
2
0
24
20
16
12
8
4
0
15-16
13-14
11-12
09-10
07-08
05-06
03-04
01-02
99-00
97-98
95-96
2016
2014
2012
2010
2008
2006
2004
2002
2000
1998
1996
Billions of Dollars
Note: Includes revenue from the personal and business income taxes. Personal income taxes include capital gains realizations.
Sources: NYC Department of Finance; NYS Department of Taxation; OSC analysis
Tax Revenue
The six largest bank holding companies by total asset size are: JPMorgan Chase & Co., Bank of America Corp., Citigroup Inc., Wells Fargo
& Co., Goldman Sachs Group Inc., and Morgan Stanley.
Lower Manhattan is generally defined as the area south of Chambers Street and the Brooklyn Bridge.
These estimates exclude revenue from real property taxes, real estate transaction taxes and sales taxes because OSC is unable to identify
the securities industrys share of those tax payments.
Prepared by the Office of the State Deputy Comptroller for the City of New York
Office of the New York State Comptroller
110 State Street, 15th Floor, Albany, NY 12236
(518) 474-4015
www.osc.state.ny.us