Up 31.5% from Last Year... Total Bonuses Reach $47.5 Billion
"Some Sectors Expected to Slow Down in 2025"
Last year, the U.S. stock market experienced a boom, and with an increase in mergers and acquisitions (M&A) transactions, Wall Street workers received an average bonus amounting to approximately 360 million won.
On the 26th (local time), the Wall Street Journal (WSJ) and others reported, citing the New York State Department of Financial Services, that the average bonus for employees working at securities firms in New York City last year was $244,700 (about 359.42 million won).
This represents a 31.5% increase compared to last year's $186,100. WSJ noted that, considering inflation, this is the highest amount since 2021.
According to the U.S. Bureau of Labor Statistics' January survey, the median annual income for full-time workers in the U.S. at the end of 2024 is $62,000. This amount is about four times the typical salary of an average American worker.
Last year, the total bonuses paid by financial firms reached $47.5 billion, which is also a record high.
However, there are forecasts that this trend may not continue this year. WSJ stated, "There are early signs that 2025 will not proceed as many bankers had expected," adding, "The market rally has disappeared, and ongoing inflation along with concerns over President Trump's import tariffs have clouded interest rate outlooks."
According to financial information firm Dealogic, there were only 2,066 M&A deals announced in the U.S. this year. The Goldman Sachs strategist group led by David Kostin recently downgraded their forecast for deals to be completed this year, lowering the growth target from 25% to 7%. Strategists explained that M&A activity depends on U.S. economic growth, CEO confidence, and the financial environment, and these factors could be affected by trade wars. Some predict that the M&A environment may become more challenging than during former President Joe Biden’s administration.
Morgan Stanley plans to lay off 2,000 employees by the end of this month, and Goldman Sachs also plans to reduce its workforce by 3-5%. Bank of America (BoA) laid off 150 junior bankers in its investment banking division earlier this month.
Thomas DiNapoli, New York State Comptroller, said, "The record bonuses reflect Wall Street’s strong performance in 2024," but also forecasted, "With significant changes in federal policies increasing economic uncertainty, the outlook for parts of the securities industry in 2025 may be sluggish."
Wall Street accounts for about 20% of New York City’s total economic activity. WSJ projected that this bonus payout would increase New York City’s revenue by $275 million and state tax revenue by $600 million compared to the previous year.
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