While most Americans aren’t expecting their incomes to rise with the cost of living in the near future, more than 60 percent of Wall Street professionals say they anticipate their bonuses will be higher or the same as the bonus they earned in 2010, according to a recent survey.
Sixty-two percent of Wall Street workers said they’re expecting a bonus that’s in line with last year’s or higher, according to a survey from eFinancialCareers.com. And while still a firm majority, that’s down from last year, when 71 percent of survey respondents said they expected the same or higher bonus than what they received in 2009.
The decline in expectations is likely due to a drop in confidence in big bank employees. The survey found that 38 percent of big bank employees anticipate a drop in their bonuses from last year, compared with 36 percent that are expecting an increase.
Big bank employees may be skittish because of a rash of recent layoff announcements. Bank of America plans to layoff 30,000 employees in an effort to trim about $5 billion per year the company announced last month. Barclays announced in August that it would slash about 3,000 jobs this year, while UBS said it plans to axe 5,000 jobs.
Bonus plans likely won’t be announced until January, but if last year is any indication Wall Street workers should expect their bonuses to fall. The average Wall Street bonus was down 9 percent in 2010 as the reforms in those Dodd-Frank Act aimed at curbing bonuses pushed in fact base salaries and deferred compensation up.
More than half of the survey respondents said they believed that the financial reforms played a large role in big banks’ decisions to downsize. Bank of America President Brian Moynihan and other banking industry officials have also cited the Dodd-Frank act as causing revenue declines that pushed the companies into charging consumers more fees for various checking account services.
Still there are some that think the reforms haven’t gone far enough to curb Wall Street excesses like bonuses, which came out to an average of $128,530 in 2010. Protesters, calling themselves Occupy Wall Street, have been camped out in Manhattan’s financial district since Sept. 17 demonstrating against corporate greed and income inequality among other things. The movement has inspired similar demonstrations across the country.
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