Reports

Wall Street’s $23.2 billion in pretax profits for the first half of 2024 were a dramatic 79.3% increase over the same period last year and buoyed by securities trading, underwriting, and account supervision. The City's securities industry has the greatest number of jobs in the nation despite a decline this year. The industry also continues to contribute tax revenues at or above pre-pandemic levels, and its contribution should exceed tax forecasts if stronger-than-expected profits hold up.

The average annual Wall Street bonus dipped to $176,500 last year, a 2% decline from the previous year’s average of $180,000. Wall Street’s profits were up 1.8% in 2023, but firms have taken a more cautious approach to compensation and more employees have joined the securities industry, which accounts for the slight decline in the average bonus.

Wall Street’s 2023 first half profits of $13 billion were down 4.3% from the same period last year but tracked the industry’s return to pre-pandemic levels of revenue after record profits in 2020 and 2021. Financial firms’ interest expenses were seven times higher in 2022 than in 2021. Data for 2022 will likely show a decline in the industry’s economic contribution, back to pre-pandemic levels (14.5% in NYC in 2019), reflecting the drop in firms’ profitability.

Wall Street’s 2022 average bonus paid to securities employees dropped to $176,700, a 26% decline from the previous year’s $240,400. Rising interest rates and fear of a recession led to significantly less profits on Wall Street after a record year in 2021.

Following near-record profitability in 2020, securities industry pretax profits rose even further in 2021. As federal stimulus actions have wound down, profits in 2022 are returning to pre-pandemic levels. New York State and City are reliant on tax revenues from the industry and must be cautious in managing their budgets given continued uncertainty in the financial markets. Though national sector employment has grown recently, the City’s share of national sector employment continued to decline slightly.

The average bonus paid to employees in New York City’s securities industry for 2021 grew to $257,500, a 20% jump over the previous year’s record high. The estimated bonuses paid out on Wall Street are higher than the city’s most recent 15.7% growth projection, and should help the city exceed its expected revenue from income taxes.

Wall Street’s run of prosperity extended into the first half of 2021 with $31 billion in pre-tax earnings, beating 2020’s outsized first half profits of $27.6 billion. Despite continued strong profitability, employment in the industry in New York City has sagged, even as it has ticked upward in the rest of the nation. Average salary, including bonuses, reached $438,000, the highest of any industry and nearly five times higher than the average in the rest of the private sector.

The average bonus paid to employees in New York City’s securities industry grew by 10 percent in 2020 to $184,000, in line with the city’s most recent 9.9 percent projection, likely allowing the city to meet or exceed its income tax revenue projections in FY2021.

The COVID-19 pandemic has significantly impacted the securities industry in New York City, affecting both operations and profitability.

The average bonus paid to employees in New York City’s securities industry increased by 3 percent in 2019 to $164,100, but it is likely to fall sharply in 2020 as the coronavirus crisis strains industry profitability.

Despite slower global economic growth and trade tensions, pretax profits for the securities industry grew by nearly 11 percent in the first half of 2019, reaching $15.1 billion, the best first half in a decade.

Securities industry profits in 2018 were 11 percent higher than the previous year, but the average bonus paid to industry employees in New York City declined by almost 17 percent to $153,700.

Securities industry pretax profits grew by 42 percent in 2017 on higher revenue from core activities. That momentum has carried into 2018, with profits rising by 11 percent during the first half of 2018.

Securities industry profits rose dramatically in 2017 for the second consecutive year and the average bonus paid to industry employees in New York City jumped 17 percent to reach $184,220.

Since the 2008 financial crisis, New York City’s economy has become more diversified and less dependent on the securities industry.

Securities industry profitability rose sharply in 2016, increasing by 21 percent, while the average bonus paid to employees in New York City’s securities industry increased by 1 percent to $138,210.

The role of the securities industry in New York City’s economy has changed since the financial crisis. The industry is smaller after shedding 8 percent of its jobs since 2007, while the rest of the City’s private sector has grown by 17 percent.

The average bonus paid in New York City’s security industry declined by 9 percent to $146,200 in 2015 as industry-wide profits declined by 10.5 percent.

In the seven years since the 2008 financial crisis, regulations designed to increase stability and transparency in the financial system have changed the way the securities industry operates.

The average bonus paid in New York City's security industry rose by 2 percent to $172,860 in 2014.