A word of warning to Ivy League Excel jockeys heading to Wall Street: You may end up in Salt Lake City. It’s a long commute to the Hamptons, and the nightlife can be … well … sobering. Then again, think of the skiing.
Utah, already home to 5 percent of Goldman Sachs workers, is gaining momentum in its bid to be Wall Street of the West. State economic development officials say they are in advanced talks with three major banks on projects that would bring an additional 1,000 securities jobs to Salt Lake City.
For finance companies, the strategy is a classic arbitrage trade. The state offers real estate and labor well below the rates demanded in the concrete canyons of New York or other finance hubs. And, in part because a high percentage of the Salt Lake City population has completed the Mormon church’s two-year missionary program, foreign language skills are abundant. More than half of Goldman’s Salt Lake workforce is fluent in a second language.
Utah is also sweetening deals with major incentives, offering credits of up to one-quarter of corporate tax bills. That means Goldman will receive $47 million in Utah rebates by 2029, provided it keeps about 1,100 workers in the state and hits certain investment hurdles. Four years after signing that deal, Goldman has already met the first target. It has 1,500 Utah workers and is still making a strong Salt Lake sell in its recruiting materials.
It’s not just tech support. Goldman now has asset managers and research folks in the state. It even recently added a team of investment bankers. Next month, the company will host its annual meeting in Salt Lake City, its first outside New York City.
The state has also notched smaller recruiting victories of late. Morgan Stanley has expanded its Utah operations three times in the decade since it opened an office there. In November, Royal Bank of Scotland committed to hiring 310 workers in the state, in exchange for $5.3 million in tax credits.
Granted, another 1,000 jobs won’t change the industry. But in a smaller city like Salt Lake, those jobs are significant, and over time, those zeros add up.
Meanwhile, the share of securities industry workers in New York City has fallen from 30 percent to 21 percent in the past 20 years,, according to a recent report by the Securities Industry & Financial Markets Association. The city’s finance industry now employs 169,700, down from a peak of 200,300 in 2000.
The labor picture is similar across the Atlantic. Employment in London’s financial services industry is nearing a 20-year low, though City banks and brokerage firms still employ about 237,000 people. Powder skiing is not one of their perks.