New York Facing Job Cuts
If you're new here, you may want to subscribe to my RSS feed. Thanks for visiting!
Oh no, job cuts and unemployment on the rise. New York, being closely tied to Wall Street, can expect a lot of people out of the streets.
As the city braces for a big contraction in the financial sector as a result of the credit crisis and the collapse of Bear Stearns, the fallout could be worse than in the past.
The New York economy is more dependent than ever on high Wall Street incomes. Last year, the finance industry was responsible for nearly a third of all wages earned in the city, the highest in modern times. And each Wall Street job supports three workers in other sectors.
A great many of the 14,000 employees of Bear Stearns are expected to lose their jobs because of the firm’s cash shortage and its pending acquisition by JPMorgan Chase. As the credit crisis unfolds and other firms discover the depths of their losses related to bad loans, few expect the layoffs to stop there.
Now there are signs of nervousness, and not just among bankers and traders. Some prospective buyers in the pricey condominium market have put their plans on hold.
The last time Wall Street had a similar contraction was after the technology bubble burst seven years ago. At that time, financial firms cut 60,000 jobs in the New York City area, or 1 in every 10 finance position.
