Web Search powered by YAHOO! SEARCH
share
email
font size
options
 
Thursday, September 4, 2008
GMAC cutbacks add to the 1,400 local jobs lost

The subprime mortgage crisis and housing meltdown often feel far away from our region.

I’ve seen the pictures of half-built California subdivisions and the lines of depositors outside IndyMac Bancorp branches. Each month, a different warm-weather metro area is anointed the worst for foreclosures.

Here in Philadelphia, we appear to be late for the apocalypse again. Housing activity has slowed, although prices seem to be holding steady.

But the ripples from the yearlong credit quake have done more than shake the dishes in our kitchen cabinets. They have swamped the jobs of a number of people in the region.

Yesterday, GMAC Financial Services announced major personnel cuts for the second time in a year. Fort Washington-based GMAC is eliminating 60 percent of the workforce of its Residential Capital L.L.C. subsidiary. That’s about 5,000 people -168 locally.

The move comes more than 10 months after GMAC cut about 3,000 jobs at the unit it calls ResCap. That layoff hit 180 people in Horsham and Fort Washington.

But GMAC isn’t the only local company to announce job cuts. My review of the layoff notices for Pennsylvania and New Jersey for the last year show 11 financial-services firms announced layoffs of 1,442 people in the area. The notices reflect jobs that companies intend to cut; sometimes they don’t follow through on all of them.

Among the biggest, Chase Home Lending, a unit of JP Morgan Chase & Co., targeted 266 people in Fort Washington for layoff as of July 31. Wilmington Finance Inc., a subsidiary of American International Group, announced it would cut 213 jobs in Plymouth Meeting by Aug. 17.

I counted cuts that came from institutions involved in more than mortgages. For example, Interbay Funding L.L.C. is a Fort Washington wholesale lender focused on financing for small commercial real estate projects. It wanted to cut 108 jobs by April 1.

SLM Corp., the student loan firm known as Sallie Mae, sought to slash 163 people as of July 1 from its Mount Laurel office.

So while we’re not ground-zero when it comes to the credit crunch, we certainly feel the after-shocks.

Posted by Mike Armstrong @ 3:05 AM  Permalink | File Under: Financial Services | Post a comment
Comments   
0 comments
About Mike Armstrong
Mike Armstrong, a business editor and writer for nearly two decades, is the Inquirer's business columnist and PhillyInc blog editor.
Advertise Here
Philadelphia Business Today