Like tech and media, the housing industry is also experiencing workforce shakeups. Wells Fargo laid off “hundreds” of mortgage division employees, an anonymous source told Bloomberg in a Dec. 1 report. The month prior, labor experts and housing industry professionals had discussed the lack of mortgages and loans in the pipeline — thanks to interest rate hikes and denouement of the “pandemic-fueled housing boom.”
JP Morgan Chase reduced its home lending staff by the hundreds in June, sources confirmed to Bloomberg. Following an April round of layoffs, Redfin laid off 13% of its workforce in November and closed down its home-flipping service Redfin Now. More broadly, Goldman Sachs leadership is eyeing layoffs and Morgan Stanley, a company handling wealth management and asset management, also whittled down headcount by 2% this month.
The banking and investment industries experienced large amounts of workforce growth in recent years, financial service experts say; the decline may only be natural.
Adding nuance to the conversation, National Association of Home Builders Chief Economist Robert Dietz told HR Dive there's always some level of quits and layoffs within residential construction. “It probably has more churn than other sectors of the economy. I tend to focus on the net payroll employment numbers,” Dietz said, referencing the JOLTS report. From his perspective, these numbers have indicated “weakness” for single-family home building, while the remodeling and multifamily markets remain strong.
This provides an interesting dilemma regarding talent in the housing industry. Dietz nodded to what he called a “skilled labor shortage” in the construction industry, which may continue given that multi-family home construction and remodeling plans are likely to proceed throughout 2023.
“It's not going to be one-for-one with declines in economic activity, because builders still want to hold on to those workers when the market rebounds,” Dietz said.