Wall Street bonuses drop a lot this year

Global Business

Wall Street bonuses drop a lot this year Wall Street bonuses drop a lot this year

The holiday season has traditionally been gift time for many on Wall Street. Bonuses account for roughly half of annual compensation in the financial services sector. But that’s changing for those who work on Wall Street.

CCTV America’s Karina Huber reports from New York.

Wall Street bonuses drop a lot this year

Wall Street bonuses drop a lot this year

The holiday season has traditionally been gift time for many on Wall Street. Bonuses account for roughly half of annual compensation in the financial services sector. But that's changing for those who work on Wall Street. CCTV America's Karina Huber reports from New York.

The average bonus on Wall Street in 2014 was over $170,000. That is about three times the median household income in the U.S. But this year payouts are expected to be a lot less generous, as trading revenue was hit by a slowdown in the global economy, regulatory constraints have increased, and because of worries about the direction of interest rates.

The drop in overall bonuses could impact spending on big-ticket luxury items and will likely hit tax revenues in cities like London and New York that have large numbers of financial services workers.

Experts said the lower compensation handed out this year is not likely to be the new normal. Once the global economy and the stock market start to pick up, big bonuses will rise along with them.