Tomahawk, WI 9/23/2013 (BasicsMedia) – Wells Fargo & Co (NYSE:WFC) is a global brand. It is a holding company which offers diversified financial services. Its operations are carried out under 3 different segments, namely, wholesale banking and wealth, brokerage and retirement, as well as community banking. Its services are offered to clients through its banking stores, over the Internet, offices, as well as several other channels. Its presence in the U.S is felt in all the 50 states, while it also has a global reach. Recently, it decided to cut off come 1,800 workers from employment. Why?

 WFC Active in Provision of Mortgage Services

 WFC is one of the companies which have been quite active in the provision of mortgage services. This line of business has not enjoyed the best of times in 2013, a trend which goes back to the period preceding and after the financial meltdown which affected the entire globe in 2008. The decision by WFC to discontinue the services of more than 1,800 of its workers is born out of the realization that the mortgage services business, which it depends on quite a lot, is not as heavily demanded as it used to be. At the end of this exercise, it will have cut 2,300+ jobs.

 A large percentage of the employees whose services will no longer be required, are those working in its mortgage loan processing department, especially the one which is consumer-based. However, there are two regions within WFC which won’t be affected by these job cuts in any way; they are Triad and Winston Salem. The previous wave of job cuts also left these two regions as the ones least affected, and this is the second time the same is happening. Part of the reason why the demand for mortgage services has declined is the increasing interest rates.

 Factors Responsible for Loss of Jobs at WFC

 As long as interest rates are still at a much higher level, demand for mortgage-related services from companies such as WFC will go down. When this happens, it is not surprising to see companies opting to cut on jobs as a means of cutting costs. This is designed to ensure that the WFC is able to increase its efficiency levels so that it continues providing the services its clients are greatly in need of. These job cuts are not limited to only one branch of WFC in the U.S. It is widespread across the U.S and there is a good chance that it may affect the international offices.

 But even as WFC embarks on this period of job cuts, it hasn’t stopped hiring new employees. Its business in downtown Chicago, which currently boasts of around 800 workers, plans to embark on a hiring exercise which will see some 50 new employees added to the roll. This is the message which has been issued by its current CEO, John Stumpf. However, these additional workers will not be added to its retail branches. Unlike other companies which are forced to carry out job cuts for reasons which are not clear, WFC’s decision understandable and can produce desired results.

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