The importance of the financial services industry in general and the securities industry in particular to NYS and NYC is long standing and well recognized. The securities industry has a profound impact on, and makes a significant contribution to, revenues and overall growth of the state and local economies and is a vital part of NYS’s economic base.
Although the U.S. securities industry’s services extend nationwide and globally, it is centered in NYS: it was born on Wall Street in 1792, and 230 years later, the largest U.S. broker-dealer firms are still headquartered in NYS and 18.8% of its U.S. workforce is located in NYS.
As of December 2023, the U.S. Bureau of Labor Statistics estimated that the securities industry employed 1,123,000 individuals throughout the U.S. In NYS, 210,900 people were employed by the securities industry and about 90% of those, or 190,300, were in NYC.
The securities industry operates in all regions of NYS with almost 8,500 offices and over 114,500 registered representatives in more than 600 cities and towns across the state.
Employment in the securities industry directly affects the overall number of jobs in NYS and NYC. The Office of the New York State Comptroller recently estimated that 1 in 18 NYS jobs (over 5%) and 1 in 11 NYC jobs (almost 9%) are either directly or indirectly associated with the securities industry.
The securities industry accounts for a larger share of total wages paid in NYS than its percentage of total employment would suggest. While accounting for 2.5% of NYS private sector employment, the securities industry generated 15.2% of NYS private sector wages in the first half of 2023.
In fiscal year 2023, the total estimated tax collections derived from the securities industry totaled a record-high $28.8 billion in NYS, accounting for 27.4% of NYS’s total tax revenue, up from 22.0% in 2022. In NYC, estimated tax collections derived from the securities industry totaled $5.4 billion, or 7.5% of NYC’s total tax revenue. This is flat from 2022 and tied for highest dollar amount since the collection of data started in 1996.
NYS continues to rank as the 24th most favorable state in the corporate tax category of the Tax Foundation’s Annual 2024 State Business Tax Climate Index (down from 7th in 2018, due to the corporate tax breaks enacted in other states). Unfortunately, NYS continues to rank second-to-last in the overall index, ahead of only New Jersey.
Despite challenges stemming from a changing regulatory environment, accelerated globalization and geographical dispersal resulting from the COVID-19 pandemic, the U.S. securities industry remains centered in NYS and heavily concentrated in NYC. The prospects of NYS, NYC and the securities industry are intertwined, and each year we examine this relationship to provide important insights into the outlook for the Street, the City and the State.
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.