Photo

GMT

Threat to 20,000 Wall Street jobs

More than 20,000 people are forecast to lose their jobs on Wall Street as the credit crunch bites into business at financial institutions over the next two years

New York's Independent Budget Office, a non-partisan agency which scrutinises the city's finances, estimates that profits on Wall Street fell by 80% during 2007 to $3.2bn - the lowest level since 1994

In a report published this week, the office predicted that 12,600 job cuts this year, followed by 7,600 in 2009

"The economic situation is particularly precarious," said Ronny Lowenstein, director of the publicly funded agency. "If the problems affecting Wall Street and housing worsen, the recession will be deeper and the fiscal pressures on the city will quickly mount."

The figures do not include the likely redundancies at Bear Stearns

almost 35% of wages in the city come from the financial sector.

banks and brokerages have shed 34,000 jobs over the last nine months