The average compensation at Goldman (GS) is likely to fall by nearly $100,000 by the end of next year as new regulations, fewer deals and legal payouts hurt the firm’s profitability. That’s the conclusion of a recent report from a European division of rival JPMorgan Chase (JPM).

As recently as two years ago, Goldman’s annual pay, which includes everyone from the people who work in the firm’s IT department to CEO Lloyd Blankfein, had averaged $412,000. That salary put employees of the elite investment bank solidly in the top 1% of all earners in the United States. Last year, the cut off for the 1% was $368,000.

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But by the end of next year, though, analysts at JPMorgan Cazenove expect compensation at Goldman to average just $314,000. That will bump the average Goldmanite all the way down to near the bottom of the top 2% of all U.S. earners. The cut off for the 98% tops out at around $290,000.

Needless to say, this is not nearly the crushing blow to the Masters of the Universe that some hoped the financial crisis would be. And remember this is average compensation. There are still plenty of Goldman bankers who make millions. Blankfein was paid $12 million for 2011.

Back in 2008 and 2009, though, there was talk that the near collapse of Wall Street, and the fact that the government had to come to the rescue, would force financial firms to rethink how, and how much, they pay their employees. Washington appointed a pay czar. The Federal Reserve instituted new rules. Clawback provisions became the norm.

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But the dollar figures haven’t changed all that much. The only thing that does appear to have made a slight dent in Wall Streeters’ wallets is Dodd-Frank and some other new international capital requirements, which is why, perhaps, bankers have objected so loudly.

Goldman has been among the most impacted. Dodd-Frank bars the firm, and others, from certain high-profit, and high-risk, businesses, including proprietary trading and hedge fund investing, where Goldman has historically made a good deal of its profits. What’s more, the new requirements will cause Goldman and other firms to hang onto more of their cash, rather then lend it out or invest it.

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All told, the analysts at JPMorgan say, if Goldman were to do nothing, regulatory reforms will knock the firm’s return on equity, a key measure of profitability, down to 10% from 17% shortly before the financial reforms went into place, though in many years it was much higher than that.

In response, the analysts believe Goldman will cut employees and salaries in order to lower costs and repair profits. Goldman is likely to send an additional 4,400 people from its investment banking division packing. As of the first quarter, Goldman’s staff had already shrunk by about 2,000 in the past year.

Goldmanites are still expected to take home more than rivals. According to the JPMorgan’s projections, the average investment banker at all firms will make $233,000, down from $303,000, before the regulations. But that figure may actually be higher. The JPMorgan analysts didn’t include their own firm in the analysis. Consultants say the firm’s compensation now rivals Goldman’s pay, which would bring up the industry-wide average.

Credit Suisse, in the survey, was expected to be the second highest paying investment bank in the world after Goldman at an average pay of $280,000. The average comp at Morgan Stanley (MS) could drop to $244,000, which would put that firm’s employees in the top 3% of all U.S. earnings. Woe is Wall Street.