A quarter after Goldman reported the highest per employee comp since the record bonus period just after the Lehman bankruptcy, when the average employee of the firm's then 31,700 workers made $431,956, the firm which once ruled the world proudly with tentacles running every important global central bank, was forced to slash employee comp by a whopping 35%, from $3.7 billion, a comp margin of 44% in Q3 2012 and roughly the same last quarter, to a tiny $2.4 billion, or a comp margin of just 35.4%, resulting in average trailing 12 month per employee (of which it had 32,600 in Q3 2013) accrued compensation of just $380,368, the lowest since Q2 2012.
And this is why the bank-holding company that is Goldman (still waiting
for those Goldman ATMs) should have had a massive balance sheet, with
billions in distressed loans counted as perfectly performing, so like
JPM, Wells, Citi and BofA it could just take out billions in loan loss
reserves releases (or just add back three years of "non-recurring" legal charges) instead of having to impair its employees and force them to suffer the indignity of being paid just a few thousand percent above the average peasant.
But before the crying begins because the average Goldman employee makes only $380K, remember: this is average, and largely pushed lower by comp at the low-end. Those Goldman employees who make $10-20 million and more per year will hardly see a big impact in their compensation package this, or any other year. That, and of course the fact that the bulk of comp comes on line as prior year bonus pools vest in the current and future quarters.
What is notable however, is that in a quarter in which the US government unleashed hell on Jamie Dimon and JPM for countless market manipulation reasons, Goldman has, prudently, decided to keep a low profile and can now proudly point to this PR spectacle, and say just how careful and mindful of shareholder (over employee) interests the hedge fund truly is.