Financial Jobs Leaving Wall Street for Main Street
Tuesday, July 31, 2012
Some of the largest accounting and finance companies in New York are heading out of the city and into less expensive towns across the U.S., opening up positions in areas where such jobs aren't traditionally found.
According to The New York Times, the mass exodus out of New York is coming even as banks mull over more staff cuts.
"Places like New York or London will remain financial centers, but most of the players are taking a much harder look and asking whether they can move large numbers of jobs," said James Malick, a partner at the Boston Consulting Group who advises banks on where to relocate.
Malick added that in addition to paying higher taxes in New York, firms are also benefiting by increasing their accounting and financing staffing where real estate and labor costs are lower.
This trend, which has been dubbed by consultants as nearshoring, is becoming more popular than finding work overseas. Goldman Sachs recently announced to investors that they expect more financial services to begin employing workers in less-expensive parts of the country to further reduce overall costs.
"Some functions need to stay in the United States, but they don’t need to be in New York City or near the client," Mr. Malick said, adding that as many financial companies struggle to bring in high revenue, relocating their offices may be an even more attractive option.
According to the media outlet, a number of accounting jobs have already left New York, and led to a pick up in industry hiring in Salt Lake City, North Carolina and Jacksonville, Florida.
In August 2007, financial securities jobs in New York hit a high of 213,000 before dropping 15 percent after the financial crisis, data from the Bureau of Labor Statistics show. Since that fall, employment in the sector has risen by nearly 12,000, however the current 191,200 accounting and finance workers in New York is still before pre-recession levels.
According to the BLS, employment of accountants is projected to grow 16 percent from in the decade between 2010 and 2020. The growth will come as the demand for thorough financial documentation rises in the wake of the financial crisis and growing financial regulations.