Goldman Sachs Earmarks $16.7 Billion For Compensation and Benefits Through Q3 2009
According to a recent article on Bloomberg.com (link below), Goldman Sachs has set aside an astonishing $16.7 billion dollars for "compensation and benefits" for the first three quarters of 2009.
This works out to an astounding $527,192 in total compensation per employee, and the year hasn't even wrapped up yet.
The $16.7 billion dollar figure is just a shade lower than the $16.9 billion dollars that was paid out in the first three quarters of 2007, which was a record year in terms of total compensation dished out at Goldman Sachs.
Compensation is up nearly 50% from last year.
Aren't there restrictions on how much money Goldman Sachs can pay out for compensation, as there are with other financial firms?
The answer is - not anymore.
Goldman Sachs paid back the funds that they had received from the government during the near-collapse of the financial system last year, meaning that they are free to lavish as much bonus money as they want on their employees.
How does Goldman Sachs rationalize tens of billions of dollars in compensation when the rest of the country is struggling mightily?
The company argues that it is forced to pay out this money in order to retain workers.
If we didn't pay out this money, they argue, our competitors would poach our best employees.
The national unemployment rate is nearing 10%, and Goldman Sachs has earmarked nearly $17 billion dollars for compensation and benefits through the first three quarters of 2009.
It's no wonder why Wall Street firms aren't very popular with the general public right now.
Source: Bloomberg.com - Goldman Sachs Nine-Month Compensation Totals $527,192 a Person
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Filed under: General Market News