The New York City comptroller's office is guessing that the investor run on Bear Stearns and proposed acquisition by J.P. Morgan Chase & Co, which is still subject to approval by shareholders, will cost the city about 5,000 jobs. Other Wall Street heavyweights, such as Lehman Brothers, Goldman Sachs and Citigroup, also have either laid off workers or are said to be considering payroll cuts.
"Clearly, it's not good news for the luxury retailers," said Marcia Van Wagner, deputy controller for the budget, New York City comptroller's office. "There's going to be a lot of retrenchment in that area of spending."
Finance professionals losing their jobs, though, are expected to largely land on their feet.
"A lot of hedge funds and private equity firms are hiring," said Marisa DiNatale, senior economist at Moody's Economy.com, who studies the New York market. "Some people might not find a job for a while, but certainly others will find one right away."
"It's too soon to tell," said Michael Gould, Bloomingdale's chairman and chief executive officer, of any impact from Wall Street layoffs. "This moment, the business in Manhattan is phenomenal."
Overall, the luxury market has lost some steam, with sales decreasing 2.2 percent in February, the third consecutive month of year-over-year declines, according to MasterCard SpendingPulse, which uses credit card and other data to estimate the total market.
New York's securities industry employed almost 186,000 people as of January, said Van Wagner, citing government figures. While that is only about 5 percent of all New York City jobs, it accounted for 24 percent of total wages last year and a large portion of that is in the form of bonuses.
"It's not like it's the end of the world," said Van Wagner, noting people at Bear Stearns who keep their jobs will hold onto their salaries. But in many cases salary makes up only a small percentage of wages for top executives at financial firms, with the vast majority coming through bonuses.