Greed Is Good Again: Wall Street Bonuses Rebound

A recent graphic published in The Economist shows that the bonus pool of New York's financial-sector employees increased 15 percent in 2013, to $26.7 billion.  "The bonus pool includes cash bonuses for the current year as well as amounts deferred from previous years; deferred payments have grown in response to reforms put in place since the crisis."  The average bonus paid also rose by 15 percent, to $164,530:  "This was the third-highest average bonus on record and the biggest since the 2008 financial crisis."

Bonuses, which used to be modest, grew four-fold in the 1990s, continued to climb in the 2000s and peaked just before the financial crisis: "In 2006 New York’s investment banks paid nearly $40 billion in bonuses (adjusted for inflation)—about ten times the budget of the United Nations. During the crisis, banks had to show contrition and bonuses halved. But they have restarted their ascent. [...] The industry has been profitable for five consecutive years, but the number of jobs, estimated to be 165,000, is still 12.6% below the pre-crisis level."

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Frederique Laubepin

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