Pay Cuts Are Coming at Wall Street Banks

We heard murmurs late last year that pay at Wall Street firms will be way down for 2011 -- and now, as banks are finalizing their end-of-year bonuses, we're getting indication that the cuts will be pretty drastic. The Wall Street Journal talked to many mysterious "people familiar with the matter" (a phrase used four times in the article) in order to detail just how much pay, a large portion of which is determined with holiday bonuses being completed now, is expected to decrease for financial firms' top-level employees. For example, take a partner at Goldman Sachs. According to The Journal, "many of the roughly 400 partners can expect to see their 2011 pay cut at least in half from 2010." Same goes for Morgan Stanley, with a 30 to 40 percent pay cut for some investment bankers and traders. Certainly these pay decreases are substantial, but as these Wall Street pay-cut stories go, we shouldn't expect to see these guys at the poor house anytime soon. Average pay should fall from $431,000 in 2010 to $385,000 in 2011 at Goldman, for example, if it keeps the same pay ratio from 2010. And those aforementioned partners at the Firm will still be making $3 million to $6.5 million, The Journal says. So we're not feeling too bad for them.