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Goldman Sachs Says Average Pay Slides 16% to $135,123

Goldman Sachs’s Average Pay Slides 16% to $135,123 for Quarter
Goldman Sachs Group Inc. headquarters stands in New York. Photographer: Jin Lee/Bloomberg

Goldman Sachs Group Inc., the fifth-biggest U.S. bank by assets, set aside $4.4 billion to pay employees in the first quarter, 16 percent less than a year earlier, as revenue fell and the company cut jobs.

The amount, which covers salaries, benefits and accruals for year-end bonuses, is enough to give each of the firm’s 32,400 employees $135,123. A year earlier, the New York-based firm’s $5.23 billion first-quarter compensation expense equaled $147,825 for each of the 35,400 employees at the time.

Wall Street firms including Goldman Sachs, led by Chief Executive Officer Lloyd C. Blankfein, are reducing jobs and compensation to preserve profit. Europe’s debt crisis and new regulations have weighed on trading revenue, while slow economic growth limited fees for takeovers and financing.

“The dynamic for the trading companies has changed -- I just don’t think they’re going to be able to make the kind of money they used to make,” Mark Bronzo, a portfolio manager who helps oversee $125 billion for Guggenheim Investments in Irvington, New York, said before the figures were released.

The sum set aside by Goldman Sachs equals 44 percent of revenue, about the same as in the first quarter of 2011. Blankfein, 57, received a 35 percent cut in his own compensation for last year to $12.4 million after earnings dropped 47 percent and the stock tumbled 46 percent.

JPMorgan Chase & Co., the biggest U.S. lender by assets, awarded CEO Jamie Dimon $23 million in pay and bonuses for 2011 after the company reported record earnings. Compensation at JPMorgan’s investment bank fell 12 percent to $2.9 billion in the first quarter, according to figures posted on the New York-based firm’s website last week.

The expense, which includes salaries, bonuses and benefits, was enough to pay each of the division’s 25,707 workers an average of $112,849 for the first three months of the year.

Wall Street firms typically set aside a portion of revenue throughout the year for bonuses, enabling companies to increase or decrease pay in line with performance. Average pay is derived by dividing total compensation and benefits by the number of employees and doesn’t represent what workers actually receive.

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