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Where Wall Street went after 9/11

Many may believe that Wall Street lost jobs to other cities and states. In reality, financial jobs did not leave New York - they simply did not grow.
/ Source: 24/7 Wall St.

Following the destruction of downtown New York City on September 11th, 2001, several large financial houses moved from Wall Street to neighboring Connecticut and New Jersey. This departure led many to believe that Wall Street was losing jobs to other cities and states.

In reality, financial jobs did not leave New York — they simply did not grow.

While financial employment exploded in many states, rising in many cases by over 20percent, the same jobs only increased 4 percent in New York.

24/7 Wall St. has identified the ten states where financial jobs grew the most in the last decade.

From 2002 to 2007, the stock market and corporate finance skyrocketed. The DJIA moved from 7,500 to 13,000. The number of M&A transactions, private equity deals, and trading by individual and institutional investors rose along with home prices and equity prices. Normally, New York would have benefited from this trend. Other states, however, have benefited more, as evident by the financial industry jobs growth in the those states.

To demonstrate where finance jobs are going, we reviewed the Bureau of Labor Statistics Occupational Employment Survey for 2000 and 2010 to find job growth for all employment categories that work in the finance sector. In order to reflect industry growth specifically for traditional Wall Street jobs, such as banking and asset management, we excluded all job categories that may be related to finance but also appear in other fields. For example, we didn’t count accountants or financial managers who work in many industries, from retail to manufacturing to banks. But we did count jobs that are very nearly exclusive to the financial sector, such as securities, commodities and financial services sales agents and credit analysts.

Job growth makes sense in several states on our list. Connecticut’s growth in financial jobs over the decade was 21 percent. A large number of those positions were likely created as Wall St. firms moved people to cities near New York, including Greenwich and Stamford. The presence of Texas on the list should also be expected. It added more total jobs than any other state between 2000 and 2010. But Michigan, Ohio, and Minnesota are also on the list of states that have the most gains in financial jobs. This may be because the entire financial industry enjoyed unprecedented health, at least from 2000 to 2007.

These are states where Wall Street went after 9/11:

10. Pennsylvania

  • Increase in finance jobs: 15.2 percent
  • Total No. finance jobs: 26,790
  • Total change finance jobs: 4,060

Although Pennsylvania has lost a large number of some kinds of finance-related jobs, such as those in securities and commodities, it has added a tremendous number of other positions, including financial analysts, of which it has added over 4,500 since 2000. The growth of pre-existing companies in the state, such as PNC Financial Services, contributed to the increase of such jobs. Growth of other sectors, such as energy and business services, has also driven demand for financial assistance.

9. North Carolina
  • Increase in finance jobs: 20.1 percent
  • Total No. finance jobs: 15,520
  • Total change finance jobs: 3,120

Over one half of the new Wall St.-type jobs in North Carolina over the decade have been professional financial advisors. According to Duke University, financial investment is one of the fastest growing financial sectors in the state, increasing 30percent between 2001 and 2006. The school attributes North Carolina’s healthy financial industry to the state’s “historically liberal banking legislation.” Bank of America, the largest bank in the country, is headquartered in Charlotte, NC. The state also has a strong business climate.

8. Connecticut

  • Increase in finance jobs: 21.6 percent
  • Total No. finance jobs: 14,920
  • Total change finance jobs: 3,230

Connecticut’s proximity to New York City has all but guaranteed its status as a national financial hub. The state is a leading location for hedge fund managers, such as Bridgewater and Structured Portfolio Management. According to the Connecticut Department of Labor, Connecticut has the highest concentration of financial analysts, actuaries and underwriters in the nation.

7. Arizona
  • Increase in finance jobs: 23.5 percent
  • Total No. finance jobs: 11,330
  • Total change finance jobs: 2,660

Arizona has become a major center for business in recent years. It has drawn lots of companies from California, including PayPal, Intel, and Honeywell. With this influx of business has come high numbers of financial analysts and financial advisors. There has also been an increase, of a lesser degree, of brokerage clerks in the state. The state continues to add jobs, and in the last year alone, the entire financial activities sector added 2,200 according to the Census.

6. Ohio

  • Increase in finance jobs: 24.5 percent
  • Total No. finance jobs: 20,500
  • Total change finance jobs: 5,030

The number of people employed in Ohio’s finance industry has increased just under 25percent since 2000. According to the Ohio Business Development Coalition, the state is a leader in the financial industry and is home to more than 3,500 commercial banks and 750 savings institutions. Major companies include Key Corp., American Financial Group, and Huntington Bancshares.

5. Michigan
  • Increase in finance jobs: 26.7 percent
  • Total No. finance jobs: 13,200
  • Total change finance jobs: 3,530

The type of financial occupation that added the most positions in Michigan since 2000 is securities, commodities, and financial services sales agents, according to the Bureau of Labor Statistics. Even cities that have suffered greatly in other areas have had strong growth in the financial sector. Flint, for instance, saw a 59percent rise according to the Bureau of Economic Analysis. However, this increase may have dropped off in 2006 as the housing boom ended, according to Stuart Forsyth, community bank president for Citizens Bank in Flint, who was quoted in an article at The Center For Michigan.

4. Georgia

  • Increase in finance jobs: 38.0 percent
  • Total No. finance jobs: 12,750
  • Total change finance jobs: 4,840

Georgia has had a large increase in the number of financial analysts and financial advisors. According to the Georgia Department of Economic Development, 48 financial services companies have either located or expanded in the state since 2006. Georgia is also home to home to Sun Trust Banks Inc., the 10th largest bank in the U.S.

3. Minnesota
  • Increase in finance jobs: 38.8 percent
  • Total No. finance jobs: 13,070
  • Total change finance jobs: 5,070

Minnesota is home to such major financial services companies as U.S. Bancorp and Ameriprise Financial. In total, the state has 169,000 financial jobs, according to the Minneapolis/St. Paul Business Journal. According to 24/7 Wall St. analysis, over 5,000 of these would be considered jobs in finance.

2. Virginia

  • Increase in finance jobs: 46.0 percent
  • Total No. finance jobs: 12,690
  • Total change finance jobs: 5,840

Virginia has drawn a large amount business since 2000 thanks to its welcoming business climate, including a corporate income tax of 6percent. The state has also been ranked as one of the “best prepared to navigate the changing economy, in terms of being knowledge-based, globalized, entrepreneurial, IT-driven and innovation-based,” according to the Information Technology and Innovation Foundation and the Ewing Marion Kauffman Foundation. Since 2000, the number of jobs in the finance industry has grown 46 percent.

1. Texas

  • Increase in finance jobs: 56.5 percent
  • Total No. finance jobs: 40,860
  • Total change finance jobs: 23,080

Texas has been an economic powerhouse throughout the last decade. Even in the recession, the state lost only 116,900 jobs, less than much smaller states such as South Carolina, Nevada, and Oregon. Employment in the financial sector has increased since 2001 only in 21 states, and Texas is leading the way. According to the Dallas Business Journal, the state is leading the entire nation in private sector job growth. According to 24/7 Wall St. analysis, Texas has increased its number of finance jobs by over 56 percent since 2000.