Goldman pay plunges
????Get out your hanky. Goldman Sachs bankers are making less money.
????The investment bank's average paycheck is running 30% behind year-ago levels, thanks to a trading lull that has pushed down Goldman's (GS) profits.
????So far in 2010, the firm has set aside $13 billion for pay and perks. That works out to $370,706 for each Goldman employee.
????That's a nice take, obviously, exceeding seven times median household income, and it only stands to get better for Goldmanites.
????Analysts expect the firm to pile up another $3 billion or so in profits in the fourth quarter, which should deepen the bonus pool by that much and a bit more.
????Accordingly, the average Goldman employee is on track to pull down nearly half a million dollars for the year.
????Should Goldman allow the figure to hit the $500,000 mark, it would be the first time since the bubble burst in 2007. Goldman decides how much revenue goes to cover compensation costs, and the lion's share of the rest falls to the bottom line as profits.
????This is only the latest sign that two years after the collapse of the financial system, Wall Streeters are raking it in again.
????What's more, while Goldman's third-quarter numbers are down, full-year payouts look likely to end up in the same neighborhood as last year's, thanks to the firm's unprecedented about-face in the face of last fall's pay rage eruption.
????At this time last year, Goldman had set aside $527,192 for each worker. The number put the firm on track to challenge its bubble-era average pay record of $663,000.
????But Goldman noticed that the race to bonus pool absurdity didn't sit well with everyone at a time of 10% unemployment and increasing backlash over taxpayer support for the banks.
????So after setting aside almost $17 billion for pay and perks in the first nine months of 2009, Goldman actually shrank the pool by half a billion or so in the fourth quarter, keeping its average pay for the year to $498,246.
????This was not exactly a show of great restraint. Average pay at Goldman has exceeded $400,000 in five of the past six years, with the exception being the 2008 meltdown year that brought compensation down to a miserly $363,000.
????But it showed the firm, under fire for its business practices and facing legal challenges tied to the burst of the credit bubble, was sensitive to the perception that its pay was out of control. It will be interesting to see how it handles that calculus this year.
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