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Banking bonuses in New York: This is why you feel underpaid

The Wall Street Comptroller has released his annual estimation of the Wall Street bonus pool for 2023 and while it doesn't look entirely pretty it also doesn't look entirely horrible. But it's clear why New York bank employees might consider themselves poorly paid. 

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The average bonus for New York's 198,500 securities industry employees last year was $176.5k, says the Comptroller (based entirely upon an estimate that may be subject to revision). This was down a mere 2% on 2022. However, this is not the issue.

Wall Street bankers are probably not thinking of 2022, or even of years like 2019, 2018, or 2015, when bonuses were much worse than they were in either 2022 or 2023. When they think about bonuses being down last year, they will be thinking of the pandemic years of 2020 and 2021, when bonuses were perversely far higher than the norm. 

Compared to those happier times, 2023 bonuses were down around 27%.

What will it take to get back to those halcyon days? Higher profits might help. Last year, profits per head in the New York Securities industry were $132k. In 2021, they were $323k. 

The other thing that might help is more job cuts and more automation. Following the excitement of the pandemic, the Wall Street Comptroller says banks went on a hiring spree, as shown in the chart below. 

Despite various well publicized job cuts in 2023, which are ongoing this year, the New York Comptroller thinks banks have added nearly 18,000 people since the pandemic and nearly 32,000 people in the past decade. 

If headcount were cut back to 2017 levels, when profits were last roughly on a par with 2023, that would imply around 21,000 layoffs. Average New York bonuses would then rise back up to over $200k. Magic.

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AUTHORSarah Butcher Global Editor
  • Do
    20 March 2024

    More likely those that feel underpaid have been reading too many stories on this site about how much this or that person was paid. They also dislike the mediocre $25 lunches and $7 coffees, as well as all the other over-inflated prices in NYC, which are draining their bank accounts.

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