NY Times: NYC and State Brace for Greater Demands on Diminishing Resources

[marmar]

City and State Brace for Greater Demands on Diminishing Resources

By PATRICK McGEEHAN
Published: September 16, 2008


When Lehman Brothers filed for bankruptcy protection on Monday it had debts of $613 billion. That may be too large a number to contemplate. But a few other figures — like 23 and 3 and 280,000 — illustrate just how deep and broad the effects of the crisis on Wall Street could be for New York City.

The first, 23, is an estimate of the percent of all income earned in the city that goes to people who work in the securities industry.

Although Wall Street provides only one of every 20 jobs in the city, those jobs pay so much that, as a group, they have accounted in recent years for almost one-fourth of all the wages and salaries, including bonuses, paid out in the city.

The average income of Wall Streeters last year was about $280,000, or nearly five times as high as the average of all other workers in the city. Those outsize paychecks have allowed workers on Wall Street to support many other businesses, like restaurants, luxury auto dealerships and interior decorators. Economists in the state comptroller’s office estimate that each job on Wall Street creates three other jobs in the metropolitan area.

Wall Street has already shed about 25,000 jobs this year. With the collapse of Lehman Brothers and the rushed sale of Merrill Lynch to Bank of America, which was announced on Sunday, the number of lost jobs could rise by another 10,000 in a hurry. ......(more)

The complete piece is at: http://www.nytimes.com/2008/09/16/nyregion/16impact.html

[closeupready]

1. I call BS on these figures. For one, there is no "average income of Wall Streeters".

Talking about an "average" Wall Street income in an industry with hundreds of thousands of jobs is completely useless. It's a way for them to suggest that Wall Street is egalitarian, when it is just the opposite - people at the top make BILLIONS, people at the bottom make typical entry-level salaries.

It's like talking about per capita US income, and saying, hey, look, over the last 25 years, per capita income has gone up!, when what's really happening is that those at the top have income that has exploded, and those at the bottom have been treading water and sliding backwards.

[Renew Deal]

2. And what do people in the middle make?

Most brokers bonuses are more than what I make in a year, and I work in NYC.