NEW YORK (Reuters) – The average Wall Street bonus is poised to sink this year after growing 3% in 2019 to $164,000, as the coronavirus pandemic causes steep losses in the financial industry, according to a report released by a top New York state financial regulator on Tuesday.
“The securities industry had a good year in 2019, but the serious damage that COVID-19 is inflicting on financial markets and the global economy will sharply reduce industry profits this year,” New York State Comptroller Thomas DiNapoli said in a statement, referring to the disease caused by the coronavirus.
Pretax profits for the securities divisions of New York Stock Exchange member firms rose 2.8% to $28.1 billion in 2019, the fourth year of consecutive growth for NYSE broker dealers.
Although only about 182,000 people work on Wall Street, its well-paid traders and sales people earn about one-fifth of all private-sector wages in New York City, according to the report.
The securities industry overall paid $13.2 billion, or roughly 17%, of state tax collections during the 2019 state fiscal year, and $3.7 billion, or 6%, of city tax collections over the same period, according to the report.
DiNapoli warned that the city and state will likely need to fill gaps in their tax base as the cost of the coronavirus to the securities industry will result in lower taxes paid for 2020.
“The securities industry is integral to New York state’s and New York City’s economies, as a source of tax revenue and job creator in other industries,” DiNapoli said. “The state and the city need to prepare for the severe budgetary implications of the coronavirus crisis.”
(Reporting By Elizabeth Dilts Marshall; Editing by Bernadette Baum)