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Wall Street is making money again. So Harry's at Hanover Square is serving more lunches. Career Blazers is putting more temporaries in front of word processors. Choice Courier Systems Inc. is delivering more packages.
Just as the 1987 crash dragged down hundreds of companies, Wall Street's roaring comeback means money in the bank for a host of businesses that pin their livelihood on the financial district. From printers to hotels, restaurants, employment agencies and limousine companies, a variety of businesses are riding the rebound.
"This is our big, critical industry," says Rosemary Scanlon, chief economist for the Port Authority of New York & New Jersey. "The ripple effect is enormous."
After a dismal 1990, the security industry's pretax profits climbed to a record-breaking $5.8 billion last year. Buoyed by low interest rates, small investors returning to the market and a surge in new stock issues, the Dow Jones industrial average has soared to the 3300 range. The action, combined with reduced overhead, has sent profits spiraling at big firms like Merrill Lynch & Co., Goldman, Sachs & Co. and Morgan Stanley & Co.
The rebound on the street has yet to create a significant number of new jobs, however. In all likelihood, New York will never again see the estimated 50,000 jobs lost on Wall Street since 1987. Nor is the downtown office market, plagued by 20 million square feet of empty space, likely to bounce back soon.
Still, profits on Wall Street are starting to create a ripple effect that's being felt by a wide range of companies. Though the effect has been tempered by the lingering recession, it has proven an important boost for businesses, especially those that have used the...