From an article on today's New York Times op-ed page:
Over the past generation, this business model has worked well for one group in particular: the bankers, traders and honchos who work on Wall Street. These days on Wall Street, around 50 percent of every dollar of revenue generated is paid out to its employees in the form of compensation. What other business on earth does this? None.
That's a lie (or, at the very least, a falsehood). Read Jamie Dimon's annual letter to JP Mogan Chase shareholders, which points out that "In general, at businesses that are people-intensive and not capital- or intellectual property-intensive, such as professional services companies, a high percentage of the company's revenue is paid out to the employees. Law firms, for example (which are not included in the following table), pay out more than 80% of their revenue to their employees. In highly capital-intensive companies, like telecommunications or certain manufacturing companies, payout ratios are considerably lower." (Emphasis ours). Mr. Dimon's letter includes a chart showing that compensation as a percent of revenue at the J.P. Morgan Investment bank was lower than the percentage for the newspaper industry or for healthcare providers and services. Look, for example, at the 10-K for Tenet Healthcare Corporation. Salaries, wages, and benefits for 2005 were $3.47 billion, while revenues were $7.56 billion, a payout to employees of about 46%.
