Bank of America Announces 1000+ Layoffs in Northeast Ohio
A Bank of America spokesperson says many of the employees at its Beachwood call center were hired to handle the huge volume of mortgage delinquencies that peaked in 2011 - a result of the mortgage crisis that ushered in the Great Recession. Many others others were needed to field the increased inquiries into refinancing that stemmed from historically low interest rates. Now the rates are going back up, and delinquencies are only a third of what they were at the peak.
Ned Hill, an economist at Cleveland State University, says the layoffs are certainly disappointing but not totally unexpected.
Hill: "The banking industry right now is going through contraction because of its inability to earn revenue. They're really paying attention to costs. Call centers in particular are being consolidated all over the country."
In addition to its Beachwood office, Bank of America is closing two other smaller offices in Independence and Cincinnati. October 31st will be the last day of work for nearly 1200 employees.
In a written statement, Beachwood Mayor Merle Gordon calls the closure a temporary setback for the city.
State Senator Nina Turner has written a letter to company's CEO, Brian Moynihan, inviting him to discuss with her and other Northeast Ohio leaders ways the decision might be mitigated or reversed.