Christmas was once the time of the rich bonus on Wall Street where an executive in his 20s might pocket $100,000 or more while his boss received a $1 million check.
No longer. The cheery mood has evaporated from the trading rooms and bankers' suites this holiday season.Professionals who popped champagne corks through the bull market decade of the 1980s are now just hoping to be gainfully employed come the New Year.
"It's both recession and depression. I certainly see an economic recession and when it hits me, that's what I call a depression," said an analyst at a major investment bank.
"It is not uncommon now that people that you know get laid off," he said. "They do this before Christmas because they don't want to give you a Christmas bonus."
Wall Street brokerage houses have cut about 50,000 jobs since an all-time employment high of 262,000 in 1987. That was just before the October stock market crash dramatically changed the tenor of business on the Street.
The sluggish financial markets, ailing banking industry and prospects of a recession have brought an abrupt end to the 1980s "search for instant gratification," Advest Inc. senior vice president William LeFevre said.
The grim financial outlook has also hit banks and insurance companies, giving the Wall Street professionals some familiar company on the unemployment line.
The banking industry has lost 12,000 jobs in the past year, leaving 1.52 million with positions, according to the Federal Deposit Insurance Corp.
But those figures will likely grow.
Citicorp, the nation's largest bank, said Tuesday that it will cut 8,000 jobs in the next two years. Chase Manhattan Corp., the No. 3 bank, has said it will cut 5,000 jobs.
Unlike in past years, financial service companies are trying to cut those who are paid the highest salaries - such as older bankers and brokers with long years of service.
"There's been a devastating number of layoffs," said Steven Potter, managing director of the recruiting firm Russell Reynolds Associates Inc.
Top officials are losing work, such as one 18-year veteran who was paid at least $1.5 million a year before losing his job.
"The banking industry is reflecting what we're seeing in the economy. Economists are seeing a short and mild recession. Banks are tightening their belts," said a spokeswoman for the American Bankers Association, an industry trade group.
And the bad news keeps mounting.
Prudential-Bache Securities Inc., one of Wall Street's largest brokerage firms, said Thursday it will lose $250 million this year.
The firm, owned by the nation's largest insurance company, had already announced plans to cut two-thirds of its investment banking staff.
The insurance industry, which employs 2 million, is facing its own troubles and has begun to pare back employment in property and casualty departments.
With the whole financial services sector cutting back simultaneously, top executives, who might have switched from investment banking to commercial banking, now have little place to turn.