Nearly 160 Wall Street firms have decided to pull out of New York since the end of 2019. They’ve hauled nearly $1 trillion in assets under management along with them, according to data from 17,000 companies compiled by Bloomberg.
56 of these fleeing firms have gone to Florida, while most of those remaining also headed to warmer, southern states such as Texas and the Carolinas, according to the report, which also takes note of this shift towards lower-cost regions, where the cost of living is notably cheaper, taxes are lower, and the environment is more hospitable to ambitious corporate campuses. California was another big loser in the report, also having lost $1 trillion in financial assets under management to a similar portfolio of states.
The economic blow seems poised to be pretty massive.
Last year, Wall Street accounted for 16% of all the economic activity in the city and 7.3% of economic activity statewide. The latter figure crushes the national average of just 1.7% for the securities industry, according to an October report by New York State Comptroller Thomas DiNapoli. In taxes, financial firms paid $5.4 billion in New York last year and accounted for nearly a quarter of all personal income tax collections, according to the report, which warns of a massive tax decline.
Is there a way to reverse this trend? Likely not, as long as these states seem locked into their current course.
