About the Report
The Street, The City, and The State is an annual report which focuses on the importance of the financial services industry, in particular within New York State (NYS) and New York City (NYC). The report touches on securities industry employment, the employment landscape of NYS and NYC, and the impact of the securities industry on NYS and NYC in regards to taxes, government funding, competition, and future industry and economic growth.
The importance of the financial services industry in general and the securities industry in particular to New York City (NYC) and New York State (NYS) is long-standing and well recognized. Even in these times of economic recovery and financial market regulatory overhaul, the securities industry still has a profound impact on and makes a significant contribution to revenues and overall economic growth of the state and local economy.
As of 2011 year-end data, the Bureau of Labor Statistics estimated that the securities industry employed 802,900 individuals throughout the U.S. Of that total, over 23 percent, or 188,900 positions, were in NYS and most of those (88.4 percent or 166,900 jobs) were in NYC. Employment in the securities industry directly affects the overall number of jobs in NYC and NYS. The Office of the State Comptroller estimates, based on the economic multipliers and the current level of securities industry employment, that one in eight NYC jobs and one in 13 jobs in NYS overall are either directly or indirectly associated with Wall Street. (DiNapoli: The Securities Industry in New York City).
The securities industry accounts for more of total wages paid to NYS than its percentage of total employment share would suggest. While accounting for only 2.2 percent of NYS employment in 2010, the securities industry generated 9.8 percent of total Adjusted Gross Income (AGI).
NYS's budget relies heavily on personal income taxes - particularly from the high wage earners in the finance sector. Although the securities industry's share of personal income taxes declined in fiscal year 2011, the industry remains a significant contributor to NYS's and NYC's income. The industry's employees accounted for 14 percent of NYS's and 7 percent of NYC's tax revenue, down from 20 and 13 percent, respectively, in 2009. (DiNapoli)
Public policy, in particular financial regulatory reform, remains a significant factor in the future of the securities industry in NYS and NYC. The threat of further taxation, as well as pending federal regulations has brought fundamental uncertainty to the securities industry and its business planning. The Volcker Rule, for example, if finalized as proposed, would impact banks' ability to provide liquidity to the markets and potentially affect both profits and employment in the securities industry.
- Managing Director, Director of Research: Kyle Brandon
- Research Analyst: Justyna Podziemska