As the markets waited for the Federal Reserve to outline its latest thinking on the economy, Wall Street professionals digested news that financial firms were on track to pay employees $144 billion this year, according to the Tuesday edition of The Wall Street Journal.
This means the Street is breaking a pay record for the second year in a row, despite continued turmoil in the economy and impending regulatory change. Last year’s pay total was $139 billion, meaning pay will jump 4% this year – ahead of expected revenue gains on Wall Street of 3%, the newspaper says.
Pay is expected to rise at 26 out of the nation’s top 35 publicly held securities and investment-services firms, according to the WSJ.
Also, the paper says, Wall Street should devote 32% of revenues to employee compensation. This is the same as last year, but below the 2007’s 36%.
“In asset management, the firms now have fewer mouths to feed,” said Mark Elzweig, an executive search-consultant in New York, in a phone interview. “If you have weathered successive rounds of layoffs, your compensation should be going up a bit. That’s the silver lining.”