Rocket, UWM shed thousands of workers in 2022

Two of the biggest lenders in the industry shed thousands of employees each during 2022, they revealed in new financial disclosures. 

The number of team members at Rocket Cos. fell approximately 29% while United Wholesale Mortgage's payroll was sliced by a quarter, according to earnings reports filed this week with the Securities and Exchange Commission. The reductions followed reports of sliding performance by the lenders to close the year, although their origination activities still led the market. 

Both firms Friday in statements said the reductions were not layoffs. Industry players have cut over 20,000 jobs in the past 12 months as interest rates have risen from record lows seen during the first stages of the pandemic. 

Rocket Cos. had around 18,500 employees in the United States and Canada as of Dec. 31, 2022, down from the approximately 26,000 staff to close 2021, it reported. The megalender announced two voluntary buyouts last year in April and August, with the first targeting 8% of its mortgage and title workers. In January, Rocket admitted it cut 70 employees. 

The firm hasn't disclosed how many employees accepted the voluntary buyouts. It also recently rejected allegations from former employees of even larger layoff rounds last year. 

"With a focus on our responsibility to provide pathways to career success, we offered select team members the option to participate in a voluntary career transition program," said a spokesperson for Rocket in a statement Friday. "Those who chose this option received significant cash incentives, extended healthcare and more."

The company also "selectively backfilled critical positions" as staff left the company to align its headcount with market demand, the statement continued. 

In the final three months of 2022, Rocket reported a $493 million loss, it said this week. Rocket also reduced its total expenses by $202 million between the third and fourth quarters, and from $6.7 billion across 2021 to $5.1 billion in 2022, according to SEC filings. Among that decline was a 16% annual decline in the salaries, commissions and team member benefits category to $2.8 billion to end 2022.

UWM reported a decline of 2,000 team members from approximately 8,000 in 2021 to 6,000 last year, it disclosed in a filing this week. The wholesale leader has never had a layoff in its 37-year history, CEO Mat Ishbia said in an earnings call this week. A company spokesperson Friday morning reiterated that point. 

"Based on market conditions, we no longer need to hire aggressively to grow our business and support our clients," they said. "Through natural attrition, for various reasons – relocation, a family commitment, new opportunity, etc.- our team member count has balanced out."

The company also said its hiring class includes 50 to 100 team members, where in the past it was 400 to 500 members. 

The Pontiac, Michigan firm closed the year on a down note, with a $62.5 million net loss in the fourth quarter including a $150.8 million decline in the fair value of mortgage servicing rights. It held its claim as nation's top mortgage lender for the second consecutive quarter, although Rocket edged UWM in total origination volume through the year. 

UWM's salaries, commissions and benefits fell 12% quarterly, totaling $118 million in the final three months of the year, according to earnings reports. Its total expenses crept up in 2022 to $1.43 billion from $1.39 billion in 2021.