But politicians and industry specialists say the downturn is a direct result of global market trends affecting many other finance centres.
They predict that firms are now in much better shape to take advantage of an upturn next year.
he Jersey figures over a seven-year period show a steep rise from 1996 to 2000 – when profits peaked at £1.
billion – followed by a five per cent drop in 2001 and a further four per cent decline last year, to £1.
8bn.
he estimates are based on the responses of 89 institutions representing two-thirds of total employment in the sector, specifically banks, funds administration and management, trust and company administrators, and accountancy firms.
anks reported profits of £888m, fund managers £92m, trust and company administrators £90m, and accountancy firms £20m.
verage annual profit per employee has followed the same pattern, reaching £107,000 per full-time worker in 2000 but declining to £93,400 last year.
espite this the reported annual salary costs have risen continuously since 1996, to an average of £38,400 last year, when the increase was two percentage points above inflation.
Total spending by finance firms on goods and services peaked in 2000 and has since fallen by almost £10 million, to £187 million in 2002.
inance and Economics Committee president Senator Terry Le Sueur said: ‘In relative terms, compared to London or Switzerland, we have come out far better.
We have to see the drop in profit in the context of the stock market.
John Harris, Policy and Resources director of international finance, said: ‘I’m very pleased with these figures.
I had expected to see sharper falls.
The recession worldwide has been savage and that was always going to have a big effect.
The fact that everyone has continued to pay well is a sign of confidence.
The finance industry currently employs around a quarter of the working population in the Island; 51% in banking, 34% in trust and company business, 8% in accountancy and 7% in funds administration.
There was considerable movement of staff within the sector last year, with approximately half of all staff hired coming from other finance firms.
But recruitment from schools and universities fell by 42%, from 275 to 160 in 2002.
ersey Finance chief executive Phil Austin said that the industry was feeling more optimistic about the year ahead.
‘They have been putting their house in order and although job numbers have been going down the Island is still attracting high value revenue earners,’ he commented.
eputy Gerald Voisin, president of the Economic Development Committee, said: ‘It is very difficult to assess 2003, but there have been a lot of banks restructuring, which obviously they wouldn’t do if there was nothing to be earned at the end of it.
What I am hearing anecdotally is that banking is doing rather well, but private client and fund business is a bit more difficult.
Firms have a lot of work coming in and they are making optimistic noises.
The statistics unit calculated separate statistics for each of the four sectors, but have declined to release the full details to the media.
