Count on Meredith Whitney to bring us the bad news. An August 31 report from the outspoken financial services analyst, word of which hit the airwaves last week, calls for 5% to 10% layoffs on Wall Street in coming months, with anywhere from 40,000 to 80,000 financial services types losing their jobs. These are not inconsequential numbers.

Her reasoning should not surprise anyone who’s been watching the wrenching adjustments being made in the financial sector over the past few years. In a report entitled, “Coal in Stockings and Pink Slips for New Years,” Whitney notes that 2009 saw the only decline in outstanding US debt since 1946.

What is clearly (finally!) evidence of rational activity at the level of the individual bodes poorly for an industry built around servicing that debt, and the numbers are stark: according to Whitney, securitization drove 30% of global debt underwriting revenues between 2002 and 2007. Since then, that portion has dropped to just 6%.

Do you know any unemployed brokers? You should. Some 133,000 have lost their jobs in the last three years. It was only a few years ago that the financial services industry had seemingly taken over New York City. In 2000, by my calculations based on data from the securities industry and the US Census, some 2.5% of New Yorkers worked in finance. That portion is down to 1.9% today.

That’s no small change — the industry has fired nearly 34,000 people in the Big Apple alone. Hard as it is to believe, in 2000, almost one third of 1% of the population of the entire country — some 836,000 people — worked in finance. The portion is down to just 0.26% today, but is still nearly a million people. Who knew we needed so many pencil pushers to make this old engine run?

Pockets of hiring

There are bright spots. As Whitney herself points out, US banks are hiring in their emerging markets divisions. Are we finally back to the point when taking a job on Wall Street entails taking a risk, and not just the receipt of a big bag of cash come New Year’s?  And according to the New York Times, there’s a bona fide hiring “frenzy” going on among M&A bankers in London. (If by frenzy you mean a half dozen people moving from job to job, that is.)

Hey, it could be worse. A recent survey from eFinancialCareers suggests that things are most pessimistic in Germany, where only 35% of those polled think finding a new job would be “easy.” Tell that to the nearly 10% unemployed in this country without expertise in packaging bogus loans for purchase by pension funds.

While we’ve beaten this dead horse before, allow us to do it again: is it not remarkable that Wall Street bonuses actually rose in 2009—by 17%, no less—to a total of $20.3 billion? It is not, actually. For all the damage done by financiers to the real economy of countries around the globe, Wall Street’s own employment policies do tend to be as ruthless as they come. The winners take all, and the losers are fired as quickly as you can blink an eye. At least now there’s competition for those dollars.

Wall Streeters will always make more money than seems acceptable to the rest of us. But at least they’re back to actually fighting over the pot.