The 1% never had it so rough—well, at least not since the economic crisis was at its worst. Thanks to a terrible year for the stock markets, Wall Street pay is down big-time. The Wall Street Journal reviewed 34 publicly traded financial firms and calculated their total compensation to be $159 billion for 2011, the smallest amount since 2008. Actually, pay was on track to hit a record high for the first three quarters of 2011 at those companies, but a miserable end of the year wiped out much of that, according to the Journal's survey.
At Goldman Sachs, the average employee compensation will likely fall 10.7% to $385,000; for its 400 partners, pay could be cut in half compared to 2010. At Morgan Stanley, bonuses for investment bankers could fall as much as 40%. And with new regulations reining in risk taking, industry experts say the party is over for Wall Street. “It’s likely 2011 will be the worst year for revenue growth for the banks since 1938, and so far 2012 isn’t feeling much better,” one analyst told the New York Times. “The industry simply grew too fast over the past two decades and now it’s downshifting. This process will take time, but the hit to revenue is happening now.” On the other hand, many Wall Street employees are getting more bonuses in the form of company stocks, and with markets down now, those stocks could turn into a major windfall should the markets rebound. (Read more Wall Street stories.)