The state of New York will lose nearly $1 billion in revenue because cash bonuses to Wall Street employees declined 44 percent in 2008, according to a report that state Comptroller Thomas DiNapoli issued on Wednesday. DiNapoli estimates the securities industry paid its New York City employees $18.4 billion in bonuses for 2008, down from almost $33 billion in 2007. The drop in bonuses will cost New York City $275 million, DiNapoli said. “The securities industry has already lost tens of thousands of jobs, and the industry is still continuing to write off toxic assets. It's painfully obvious that 2009 will probably be another difficult year for the industry,” DiNapoli said in a written statement. His evaluation accounts for personal income-tax collections and other factors, including industry revenue and expense trends. The decline is the largest on record in dollars and the largest percentage decline in more than 30 years, but the bonus pool is still the sixth-largest on record. Before the financial crisis, business and personal income-tax collections from Wall Street activities accounted for up to 20 percent of state tax revenues and 12 percent of New York City tax revenues. The average bonus declined by 36.7 percent to $112,000 in 2008. The decline in the average was smaller than the decline in the bonus pool because the pool was shared among fewer workers as the industry shed jobs.
