(Bloomberg) -- Wall Street has contributed less than 2% of New York City’s job growth since the recession ended as cost-cutting efforts have led banks to replace fewer positions than other businesses.
The securities industry has recovered about one-fifth of jobs lost during the slump, New York State Comptroller Thomas P. DiNapoli said in a statement today laying out his analysis of the city’s budget. The industry had $6.6 billion in profits in the first quarter, almost half of the city’s estimate for the full year.
The biggest U.S. banks, including New York-based Citigroup Inc. and Morgan Stanley, are leaning on expense savings from job cuts to improve profits as merger and trading activity remains below pre-financial crisis levels. New York City’s total private workforce has increased more than 10 percent from its low point during the recession and has surpassed its 2007 high, according to state Labor Department data.
Job reductions on Wall Street will be a “continued slow bleed” after the industry trimmed hundreds of thousands of positions in recent years, Meredith Whitney, a banking analyst and chief executive officer of Meredith Whitney Advisory Group, said in an April 30 Bloomberg Television interview. Boston Consulting Group said that month that banks will have to continue to cut costs as new regulations crimp profitability.