Despite the city economy increasingly relying on sectors like tech and health care, financial firms continue to find their way to the top of the city’s highest-earning, publicly traded businesses.
Banks, investment groups, consumer finance companies and asset management businesses collectively earned $645.6 billion in sales during fiscal year 2017, according to S&P Global Market Intelligence’s analysis of U.S. Securities and Exchange Commission filings.
The second most lucrative sector — consumer discretionary firms selling cars, clothes and other nonessential goods — collectively sold $186.7 billion in fiscal year 2017, according to S&P Market Intelligence’s analysis.
Five of the city’s 10 highest-earning, publicly traded businesses were banks or other financial firms, the data showed. Verizon Communication’s Inc. topped the list, with its $126 billion in sales last fiscal year. But JPMorgan Chase & Co.’s $113.9 billion in sales was the second highest, followed by Citigroup’s nearly $88 billion in sales.
Wall Street’s strength is no surprise, given the industry has long-standing roots in the city, according to Giacomo Santangelo, a professor of economics at Fordham University.
“The finance system of New York predates the constitution,” Santangelo said.
Working for financial companies also tends to be lucrative, with their executives’ salaries, bonuses, stock awards and other compensation averaging out to $12.3 million in fiscal year 2017, according to a second S&P Global Market Intelligence analysis.
Wall Street executives’ earnings were greater than the average executive compensation in other sectors. But in some cases, financial executives’ compensation was not very liquid.
For instance, Scott C. Nuttall, co-president of the asset management company KKR & Co. L.P., earned a total of $144.4 million in compensation last fiscal year, but his salary was just $300,000 and the rest of his compensation came from bonuses, stock options and other sources.
In recent years, city and state officials have attempted to diversify the downstate economy so that any major downturn on Wall Street has a more minimal impact.
Looking at all companies — not just the publicly traded ones — shows some signs of success, according to Jonathan Bowles, executive director of the think tank the Center for an Urban Future. Bowles said the media and tech sectors have grown substantially.
“Compared to 2009, New York is far less dependent on Wall Street,” Bowles said. “We are in a better position to weather [a financial] storm than we were 10 years ago.”
By Ivan Pereira [amNY]