Lower bonuses, fewer jobs on Wall Street projected

NY Comptroller is forecasting that 35,000 financial services jobs would be lost in NY according to NY Times. The estimate is worse than the last one in July when a loss of 25,000 was projected. NY economy relies on Wall Street to such an extent that each financial services job created or lost results in 2-3 additional jobs being created or lost. As a result, a total of 165,000 jobs are projected to be lost during the downturn for the state. The earlier estimate was 85,000.

A separate report by NY's Division of Budget issued 2 weeks ago, projects 40,000 financial services jobs in NY will be lost.

Unsurprisingly, DoB's report also projects significantly lower bonuses for next year - a drop of 43%. The $27.5 Billion in bonuses would be lowest since 2003 on an inflation-adjusted basis. The lowered bonuses and less capital gains tax will result in almost 1 billion dollars net loss in the state income tax revenue.

There is not even an inkling of good news in these projections. One can only hope that these estimates are conservative enough and would'nt be revised negatively again. NY state is probably more vested in getting an accurate estimate than National Association of Realtors (NAR) which has unabashedly continued revising their housing price predictions lower for 2 years now.