NYC Loses 1,200 Securities Industry Jobs in 2012
Job cuts in the securities industry for New York City are likely to continue through the rest of this year, and 1,200 jobs have already been lost, according to a report from the state of New York’s Office of the Comptroller (OSC), headed by Thomas P. DiNapoli.
“Employment in the securities industry in New York City has fluctuated during 2012, but there has been a sharp decline in recent months,” according to the report, “The Securities Industry in New York City,” released yesterday.
The report estimates that there were 168,700 jobs in the securities industry in August 2012, a level that was seasonally adjusted. However, that number of jobs is 4,800 fewer jobs than in May 2012.
“Employment in the securities industry in New York City rose steadily throughout 2010 and most of 2011,” according to the report. “Since the beginning of 2012, the industry has lost a net of 1,200 jobs.”
The pressures caused by the Great Recession and a weak recovery combined with regulatory changes are causing firms to restructure and cut jobs, according to the OSC report. As firms hire to meet the challenges of new regulatory and risk-management standards, they are also cutting staff even in high-paying positions in investment banking.
“In light of these developments and recent employment trends, OSC believes employment in the securities industry in New York City will continue to contract slowly during the rest of 2012,” according to the report.
Overall, the report finds that “Wall Street’s contribution to New York City’s job growth has been much lower in the current economic recovery than in prior recoveries.”
The securities industry represents 3 percent of the jobs added since November 2009, “which is much less than its share at this point in the recovery following the 1990-1992 recession (18.6 percent) and the 2001-2003 recession (11.8 percent).”
While New York City now has more private sector jobs than it lost during the Great Recession—179 percent—“the securities industry has regained only 28 percent of the jobs it lost during its downturn,” according to the report.
In comparison to the rest of the U.S., New York has more securities industry jobs than “any other state in the nation.” In fact, it has “nearly two and a half times that of second-ranked California and nearly 90 percent of the industry’s jobs in the state are located in New York City.” Illinois, Massachusetts and New Jersey have seen declines in securities industry jobs.
In addition, New York City’s share of securities industry employment across the state of New York declined “slowly during the 1990s and early 2000s as back-office operations moved to lower-cost areas and firms sought geographic diversity after the terrorist attacks of September 11, 2001,” according to the report. “Since then, the city’s share of securities employment has remained relatively stable.”
Other highlights from the report are:
- For the first six months of 2012, the securities industry earned $10.5 billion and “is on pace to earn more than $15 billion by year’s end unless adverse developments erode profitability like last year. The impending ‘fiscal cliff’ and further deterioration in domestic and global economic conditions could quickly erode profitability in the securities industry in the second half of this year.” The OSC measured the broker/dealer profits of firms that are members of the New York Stock Exchange (NYSE).
- In February 2012, the OSC estimated that “the cash bonus pool for securities industry employees who work in New York City declined by 13.5 percent to $19.7 billion. Revenue and compensation trends have edged downward since that report and based on those trends the total cash bonus pool for work performed in 2012 is likely to decline for the second year in a row.”
- Average salaries, including bonuses, for securities industry employees in New York City “fell sharply in 2009, but rose by 16 percent in 2010 and by another 0.5 percent in 2011 to reach $362,950. This was a higher average than before the financial crisis and was the highest average among New York City’s major industries. The disparity between the average salary in the securities industry and the rest of New York City’s private sector narrowed slightly but it remains wide at 5.3 times greater than the rest of the private sector $67,900.”
- The OSC estimates that the securities industry in New York City lost 28,100 jobs during the financial crisis but added 7,900 jobs during the recovery. This is a net loss of 20,200 jobs since November 2007.
SIFMA Picks MD for Federal Government Affairs
Industry advocacy group SIFMA has picked Dave Oxner to be the managing director of federal government affairs, officials say. Oxner worked behind the scenes on the financial regulatory reform effort that would become the Dodd-Frank Act.
Oxner joins SIFMA from the office of U.S. Sen. Jerry Moran (R-Kansas) where he served as policy advisor.
For his new role, Oxner will be responsible for federal government relations in SIFMA’s office in Washington, D.C.
Oxner supported Senator Moran who is a member of the banking committee and is the top Republican on the financial services appropriations subcommittee, which funds the Treasury Department, the SEC, and the CFTC.
Before joining Moran’s staff, Oxner served the U.S. House of Representatives for more than eight years as a senior professional staffer on the committee overseeing financial services where he advised the members and staff on behalf of Congressmen Spencer Bachus (R-Alabama) and Mike Oxley (R-Ohio), who head the committee. During his tenure with the committee, he advised members who were helping craft the Dodd-Frank legislation.
ICAP Hires from RBS for Asia-Pac Head of Futures & Options
Interdealer broker ICAP has appointed industry veteran Richard Vine to be the Singapore-based head of financial futures and options broking for Asia-Pacific, officials say.
Vine has worked in the futures industry for 25 years for buy- and sell-side firms in the U.K., U.S. and in Asia. He joins from RBS Asia where he was recently head of APAC Futures. He was previously at MAN Financial and earlier in his career co-founded KYTE Broking.
Vine will report to Gary Pettit, global head of financial futures and options; on a regional level, he will also report to Anthony Warner, CEO of Singapore, officials say.
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