Jobs boom bypasses Wall Street

Employment report shows a decline in the number of jobs in financial activities.

By Jonathan Berr Feb 3, 2012 12:08PM
CorbisThe unemployment rate tumbled to a three-year low in January, but some workers on Wall Street may not feel like celebrating.

Government data released Friday showed that a better-than-expected 243,000 jobs were created last month and the unemployment rate fell to 8.3%. Yet, the report also showed that the financial services sector lags the rest of the economy.

For instance, there was a 7.5% drop in finance and insurance jobs, a 2% decline in commercial banking jobs, and a 2.9% drop in securities, commodity contracts and investments investments activities jobs, the Wall Street Journal says. The data is a reflection of the depressing news that has come out of Wall Street lately.

Goldman Sachs (GS), Morgan Stanley (MS), Bank of America (BAC) and Citigroup (C) announced plans to cut more than 60,000 jobs in 2011. Meanwhile, bonuses on Wall Street are expected to drop as much as 50% this year because of stumbling profits.

Net income at Goldman plunged 58% in the fourth quarter, prompting Bloomberg News to estimate that the bank's compensation and benefits costs were cut by 21%. Earlier this month, Morgan Stanley announced that bonuses would be capped at $125,000 for most employees. Bank of America is even stingier, limiting cash bonuses and freezing base salary levels to $150,000 for some investment bankers, according to Bloomberg News. Citigroup investment bankers saw their 2011 bonuses cut by about 30%.

If those masters of the universe on Wall Street are looking to change careers, however, they have a plethora of options. Several sectors experienced a significant increase in the number of jobs in January. Leisure and hospitality jobs were up by 44,000, hospitals by 13,000, accounting and bookkeeping 13,000, and architectural and engineering services by 7,000, according to the Bureau of Labor Statistics.

How ironic it would be if the industry blamed for the economic downturn continues to suffer during the rebound.

Jonathan Berr is a freelance business writer. He does not own shares of the listed stocks.
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