Last year was a good year for New York's financial industry as Wall Street bonuses grew by 10% in 2020 to an average of $184,000, Comptroller Tom DiNapoli on Friday said.
While that's in line with New York City's projection of a 9.9% rise for financial sector bonus pay, the development is also good news for the city's bottom line and tax base.
New York state, too, derives much of its revenue from Wall Street and a good year for bonuses often means the state's budget will fare better than anticipated. The news will also likely fuel calls for increased taxes on the rich amid persistently high unemployment during a recession induced by the global pandemic.
"Wall Street’s near-record year shattered all expectations. The early forecast of a disastrous year for financial markets was sharply reversed by a boom in underwriting activity, historically low interest rates, and surges in trading spurred by volatile markets," DiNapoli said.
"Income tax revenue from New York City’s securities industry will help shore up state and city budgets that are strained by steep declines in other industries, but it comes with a caution. New York benefits when Wall Street succeeds, but our economy won’t fully recover until other sectors can reopen and all New Yorkers have a chance to share in economic success."
The bonus pool in 2020 is estimated to have increased by 6.8% to $31.7 billion in the December to March bonus season, a rise from $29.7 billion in 2019.