Wages on Wall Street tumbled more last year than at any time in modern history — including the Great Depression, according to a study released yesterday by the city’s Independent Budget Office.
The IBO reported that securities-industry wages averaged $311,279 in 2009, down 21.5 percent from $396,370 the previous year, and down 24.6 percent from $412,915 in 2007.
IBO Senior Economist David Belkin said the numbers were so striking that he began digging for a similar period of such sharp declines, but couldn’t find one.
“To me, the big surprise was that even during the Great Depression, when the industry was shrinking like mad, the wages were not falling the way they were last year,” he said.
Combing historical records, Belkin determined that long-term stagnation rather than precipitous drops marked the dark days of the 1930s in the city’s financial center.
When the Depression began in 1929, Wall Street workers were earning $3,172 on average. By 1932, they were making $2,925, about 8 percent less.
The IBO’s figures appear to be at odds with those issued in February by state Comptroller Thomas DiNapoli, who pegged the average Wall Street salary last year at $340,000.
A DiNapoli spokesman said that was because the IBO adjusted for inflation and used revised federal data that wasn’t available four months ago.
Belkin explained that it was possible for wages to nosedive as Wall Street profits soared because the earnings were based on bonuses handed out in 2009 but tied to performance in 2008, when brokerage houses posted record losses.
“Even with all this noise and outrage [over Wall Street payouts], when you look at the aggregate for the whole industry, bonuses collapsed 38 percent,” he pointed out.
As a result, mayoral spokesman Marc LaVorgna said the city is counting on $12 billion less in sales and income taxes between fiscal 2008 and 2011.
James Parrott of the Fiscal Policy Institute, a liberal think tank, said the IBO’s numbers appeared to be correct but were a snapshot in time.
“They tell you more about 2008 profits and don’t say anything about 2009,” he said. “They’re meaningful as a measure of the depths of the recession. They’re not a reflection of the banner year Wall Street had in 2009.”