CHARLOTTE, N.C. — At the North Carolina offices of mortgage lender HomeBanc Corp., Archie Clark is the only employee left. But in a few days, he’ll be gone, too.
“It’s pretty much a ghost town over there,” Clark said. “Somebody went in and took the furniture from the lobby. I don’t know who did that. I put some of the other stuff in the back and locked it up.”
When Clark finishes helping movers from the company’s Atlanta headquarters collect computers and other property, he’ll join the more than 23,000 workers nationwide who have lost jobs in the financial services industry since the beginning of the month — with more than half coming since last Friday. With few exceptions, the cuts are the direct result of woes in the nation’s housing market.
More layoffs are announced daily. Since the start of the year, more than 37,000 workers have lost their jobs at mortgage lending institutions, according to recent company layoff announcements and data complied by outplacement firm Challenger, Gray &Christmas Inc.
That includes employees at MILA in Mountlake Terrace. The company once employed 700 people, but let its last 300 go earlier this year when it closed down operations and entered bankruptcy proceedings.
It’s an employment collapse that threatens to rival the massive layoffs in the airline industry that followed the Sept. 11, 2001, terrorist attacks, when some 100,000 employees lost their jobs.
“It’s far from over,” said Bart Narter, a senior analyst with Celent, a Boston-based financial research and consulting firm. “The subprime lending collapse will continue to ripple through the financial sector.”
For five years, the nation’s housing market was booming and mortgage companies grew quickly, at times offering lucrative jobs to people with little experience. But as home values declined and interest rates rose in the past year, rising delinquencies and defaults — especially in subprime mortgages targeted at borrowers with risky credit — have pounded lenders who couldn’t keep pace.
“These kind of mortgage lenders just sprung up like mushrooms,” said John Challenger, chief executive at Challenger, Gray &Christmas. “They staffed up and now you have a bust.”
America’s largest mortgage lender, Countrywide Financial Corp., began an undisclosed number of layoffs this week.
Andy Roach didn’t foresee the turmoil when he joined Greenpoint in March. As late as June, the 25-year industry veteran thought the business of making “Alternative A” mortgage loans — geared for those with slightly better credit than subprime borrowers — was on a solid track.
But in July, he said, spooked investors stopped buying the securities the company sold by repackaging the loans. A little more than a month later, Capital One announced that Roach and about 1,900 of his colleagues across the country were out of a job.
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