NEW YORK Its enough to give any investment banker heartburn.
So far this year, Wall Street securities firms have announced plans to drop more than 10,000 jobs, the most since 1998.
With profits sagging further this quarter, more pink slips are on the way, analysts and executives say. As do the markets themselves, Wall Street often swings from exuberance to stringency, prompting firms to hire one year and fire the next. Morgan Stanley Dean Witter & Co. added more than 7,000 people in 2000 and is now firing about 1,500. Goldman Sachs Group Inc., which hired 7,200 last year, plans zero payroll growth this year.
We are clearly in a down cycle, and I think it will get worse before it gets better, said Goldman Sachs chief executive Henry Paulson. Were continuing entry-level hiring, so to make room for new people, we are moving out underperformers.
It may be no coincidence that demand for Pepcid, a popular heartburn remedy, is picking up. New York sales of the product made by Johnson & Johnson and Merck AG gained 13% in the first quarter after rising 2% the previous year. Adding to Wall Streets angst, a federal grand jury and securities regulators are investigating whether brokerage firms charged excessive commissions for share allocations in initial public offerings.
Its not just bankers, traders, and brokers who have had a reversal of fortune. Victims of the market bust include Harry Grant, a 57-year-old shoeshine man who works on lower Broadway Mr. Grant, in the business for more than three decades, says hes now hanging on by a thread as customers tolerate duller wingtips to save the cost of a $3 shine.