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Wall St. firms pick up pace of hirings

By Nelson D. Schwartz
New York Times / July 11, 2010

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NEW YORK — While much of the country remains fixated on the bleak employment picture, hiring is beginning to pick up in the place that helped to lead the economy into recession — Wall Street.

The shift underscores the remarkable recovery of the biggest banks and brokerage firms since Washington rescued them in the fall of 2008, and follows the huge rebound in profits for members of the New York Stock Exchange, which totaled $61.4 billion in 2009, the most ever.

Since employment hit bottom in February, New York securities firms have added nearly 2,000 jobs, a trend that is also playing out nationwide at financial companies, commodity contract traders, and investment firms.

Though the figures are small in comparison to overall Wall Street employment, executives, economists, and recruiters say they expect the growth to pick up steam.

“I think we’re seeing some hiring in anticipation of better times,’’ said Rae Rosen, a regional economist at the Federal Reserve Bank of New York. “Wall Street typically hires in anticipation of the recovery, and there is a sense that the economy has bottomed out and is slowly improving.’’

Such cautious optimism stands in sharp contrast to the mood among workers in other fields, where jobs have been slow to return or are disappearing altogether. Since June 2008 the number of jobs has shrunk by nearly 14 percent in manufacturing and by 22 percent in construction, but only by 8.5 percent in the financial industry nationwide.

Each job in the securities sector generates two additional positions in New York City, according to the federal Bureau of Economic Analysis. In part, that is because the average salary is much larger, with Wall Street employees earning an average of $392,000, compared with $63,875 for other workers in the city.

Employment in the securities industry in New York was at 160,400 in May, up from the trough of 158,500 in February, but still well below its peak of 188,900 in January 2008, according the state comptroller’s office.

But the recovery is still very fragile. And executives say it could halt or even reverse if earnings reports for the second quarter, which begin this week, are disappointing. Another danger is a broader slowing of the economy in the rest of the year.

As a result, some banks are doing the hiring in stages, with one eye on the economy. In recent months, Morgan Stanley has hired 100 private bankers in the United States to serve wealthy clients but is holding off on plans to hire 400 more, waiting to see how the market performs.

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