A Bay Street sign, the main street in the financial district is seen in Toronto, January 28, 2013.Mark Blinch/Reuters
Last week's numbers on job cuts in the securities industry were not very optimistic, but there is a glimmer of hope hiding in there.
As Streetwise wrote, the industry has shrunk to its smallest employment level since 2010. The upshot of the article was that the declines in employment would have to continue.
But there is reason to believe the industry may not be that far off where it needs to be.
The evidence is in the productivity measure of each employee. The Investment Industry Association of Canada, which tracks the industry's performance, calculates that measure as revenue per employee.
In the first quarter, it was a robust $443,000, up from $407,000 in the fourth quarter and $420,000 in the first quarter of 2012. That is well above the performance for any year since 2009.
To be sure, revenue is likely to trail off a bit in the second quarter, given market conditions. But further downsizing in the industry is likely to mitigate the effect on productivity.
An optimist could look at this and say the worst of the cuts and consolidation may be behind the industry.
(Boyd Erman is a Globe and Mail Capital Markets Reporter & Streetwise Columnist.)
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