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Wall Street facing ten thousand job cuts by next year: report

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wall street Photo Credit: Getty Images

It’s not just the daily outpouring of protesters vilifying Wall Street that has workers and businesses in the financial district unnerved.

Financial firms could cut some 10,000 jobs by the end of 2012 and dish out fewer bonuses this year, according to a state comptroller’s report released Tuesday.

Comptroller Thomas DiNapoli said Wall Street’s “prospects have cooled considerably” for the second half of this year, and total profits by members of the New York Stock Exchange aren’t expected to surpass $18 billion for the year – one-third less than in 2010.

“It now seems likely that profits will fall sharply, job losses will continue and bonuses will be smaller than last year,” DiNapoli said in the report.

Those whose livelihoods depend on a healthy Wall Street aren’t ready for another hammering like the one that gutted the industry during the recession.

“It’s very, very scary. We’ve already lost so many jobs since 2008,” said Upper East Side resident Maura Sayers, who works as a relationship manager for a financial services firm.

She added that when layoffs occur, it’s the “working people” – from secretaries to admin staff – that get shafted: “They are not the people who make those bonuses,” Sayers said.

Shawn Reilly, co-owner of Yorganic, an eatery on William Street with trader clientele, also lamented the loss of more jobs. ”It dampens everyone’s spirits when things aren’t prospering,” he said.

Why else should it matter to New Yorkers?

DiNapoli said Wall Street makes up about 20% of the tax revenue that goes to the state’s coffers each year, and if its businesses make less, then that means less money going to the state and city.

Economist Kenneth Goldstein said the report’s findings aren’t surprising, and that the effects will be “painful.”

"In this area, even something as mundane as the taxi driver picking up a fair or a restaurant getting a customer, there's this ripple effect that occurs when jobs are lost," he said.

Mayor Michael Bloomberg also echoed the comptroller’s grim outlook.

“In the long term, I couldn’t be more optimistic about New York City, but we’re going to have some short-term pain,” he said, according to the Associated Press.

Doug Forand, a spokesman for 99 New York, which organized some of the Wall Street demonstrations, said the potential job losses sends a clear message that the U.S. must “follow a different economic path than we’ve been following.”

Former Wall Street trader Mike Patton, 29, of the East Village, is just happy to be out of the uncertainty. He was pushed out in 2008, and recovered by opening his own yoga studio, Yoga Vida. He still talks to friends who worry about their future in a shrinking industry.

“There’s not a day that goes by where I’m not thankful,” Patton said.

(With Marc Beja)

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Wall Street by the numbers

10,000: Jobs that could be lost in the securities sector by the end of 2012, according to the comptroller’s report

22,000: Estimated jobs lost on Wall Street since January 2008

4,100: Jobs lost since April

$361,330: Average salary of a securities industry employee in 2010

20%: How much Wall Street typically contributes to the state’s total tax revenue each year

14%: Percentage of state revenue garnered from Wall Street in 2010

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