Mortgage Companies Making Deeper Payroll Cuts

Nonbank mortgage lenders cut 5,200 full-time employees from their payrolls in September after letting 4,300 go in the prior month, as mortgage applications continued to decline.

Employment in the mortgage banking and brokerage sector fell to 286,200 in September from 291,400 in August, according to a Bureau of Labor Statistics report released Friday morning.

Mortgage banking companies laid off 2,700 employees while mortgage brokerages laid off 2,500 employees in September, according to the BLS report.

With the drop off in refinancings and slowing home sales, employment in the mortgage banking/broker sector is up less than 2% from a year ago.

Meanwhile, the U.S. economy created a surprising 204,000 new jobs in October, compared to an upwardly revised 163,000 in September. BLS originally reported just 148,000 persons found jobs in September.

The Labor Department decided not to count furloughed federal workers as unemployed during the government shutdown because they were still being paid. The unemployment rate ticked up to 7.3% from 7.2%.

(There is a one-month lag in the Bureau of Labor Statistics reporting of mortgage employment data.)