No one on Wall Street believes the official economic data anymore. Jobless number, spending numbers and job creation numbers are consistently revised in ways that show economic reality to be more gruesome than the original numbers showed. Inflation seems to be calculated according a formula that nets out anything with higher prices.
And now comes the new that from the U.S. Bureau of Labor Statistics that total headcount on Wall Street was flat over the past 12 months. That will be shocking news to the thousands of Wall Street workers who saw their jobs cut over the past year. Even data from private-sector analysts seems to undercount the bloodletting, showing that, on a seasonally adjusted basis, employment has declined by only 800 since the end of 2007.
So what happened to all those job losses? The answer after the jump, along with the real numbers.
Crain's Arron Elstein estimates that in the past year 22,000 New Yorkers who work on Wall Street have lost their jobs. And with IPO volume is down nearly 70% this year and M&A activity is off nearly 40%, more job losses are almost certainly on the way. The city's Independent Budget Office forecasts that 33,300 Wall Street jobs--17% of the Wall Street's workforce--will be cut by next year.
The official reporting on job losses is far lower, in part because the government doesn't count positions for which people are still receiving severance. The cuts at Bear Stearns, and other cuts recently announced, have also not hit the official numbers.
Here's Crain's estimates of job cuts at securities firms: total worldwide followed by estimated number in New York City
CITIGROUP 15,900; 3,000
BEAR STEARNS 9,200; 7,000
UBS 7,000; 1,000
LEHMAN BROTHERS 6,400; 2,000
MERRILL LYNCH 5,200; 2,000
MORGAN STANLEY 4,400; 2,000
J.P. MORGAN CHASE 4,100; 1,500
BANK OF AMERICA 3,700; 1,000
GOLDMAN SACHS 1,500; 500
WACHOVIA 1,400; 1,000
CREDIT SUISSE 1,300; 750
DEUTSCHE BANK 500; 250