JPMorgan cuts mortgage jobs in Columbus, CEO Jamie Dimon says bank is 'mostly expanding'

The largest private employer in Columbus has cut some jobs in its mortgage business, a reflection of home lending being hurt by higher interest rates.

JPMorgan Chase & Co.'s CEO, Jamie Dimon, acknowledged the losses in an interview with The Dispatch this week, but said overall the bank continues to invest and grow.

"Big companies are always kind of morphing. We're adding and subtracting," said Dimon, in Columbus to visit with workers and clients and meet with business and political leaders. "You have to be responsive to things. Unfortunately, mortgage can be a very tough business and very volatile. You have seen some cuts in the mortgage area. For the most part we’re expanding.’’

Other banks have cut mortgage jobs as well, as home sales take a hit due to higher interest rates. Wells Fargo & Co., one of the nation's biggest lender, cut hundreds of mortgage jobs this week, according to a report by CNBC.

Overall, Dimon said the bank is investing $14 billion this year in areas such as technology, new branches and adding bankers and traders.

"We're generally in the expansionary mode," he said. "That doesn't mean we’re not reducing headcount somewhere."

The bank would not say how many jobs have been cut in Columbus.

Chase has 17,200 workers in central Ohio and 20,000 in the state. At any point, the bank has several hundred openings, according to OhioMeansJobs.com, the state jobs website.

"Anyone who is being displaced we do everything we can to get them another job here or elsewhere,’’ Dimon said.

Columbus is critical to JPMorgan operations

Back in 2004, when JPMorgan bought Bank One, Columbus leaders feared that the deal would mean a loss of jobs for the region.

The old Bank One had been headquartered in Columbus, but relocated to Chicago when it acquired First Chicago in 1998. Chase then bought Bank One in 2004.

Dimon said Columbus leaders asked him to bring the headquarters back to Columbus

"I explained to them that I can’t. That battle has been fought. ... I told them at the time I’m going to do everything I can, so help me God, to build a great company. If I succeed, we will be great for Columbus. If I fail, we won’t be. It's more important for success than location because we already had so many great wonderful people here."

State of the economy

Last year while in Columbus, Dimon expressed concerned about storm clouds ahead for the economy from higher interest rates, inflation, rising costs for commodities, wage pressures and the Ukraine-Russia war.

"I still say we have a strong economy today," he said. "We’re facing some serious stuff in the future. Look, we’re going to be wishful thinkers and hope that it all sorts itself out nicely. I wouldn’t be so sure.’’

The war in Ukraine is of particular concern, he said.

"This is one of the most serious geopolitical events in our lifetime, since World War II," he said. "There have been other wars, but not that involved major economic nations with each other, a free and democratic nation like Ukraine and also affects the global economy deeply in terms of oil, gas, food, fertilizer, migration."

Dimon warns that monthly economic numbers on areas such as employment and inflation are giving a distorted view of the state of the economy.

“What's really happening is that you have a consumer who’s got a lot of money and they’re spending it. ... They have jobs, which are plentiful. Wages are going up. Their home prices are up even though they’ve come down 10% but they’re up over the last several years. Businesses are in pretty good shape and remember consumer spending drives a lot of business success," he said.

"That's still good, but it's being eroded by inflation. It's been eroded by confidence and the excess savings, we think sometime by the end of the year, will come down to zero."

'We don’t know what’s going to happen then," he said. "I look at that as danger ahead. Again, I'm hoping it all mitigates out. In the meantime you’re going to see a good jobs number, a bad jobs number, a good inflation number, a bad inflation number."

How's Ohio's economy doing?

Dimon noted the number of recent successes with companies such as Honda and Intel along with other companies that have a big presence here like Amazon and Chase.

"I think it’s fabulous … You have a governor who cares about it and is trying to get the education system right and the infrastructure right and the pro-business right," he said. "These large companies do a great job of hiring people, training people. ... You will outperform a lot of other states.’’

Back to the office

Dimon has been an advocate of getting people back to the office after working from home during the pandemic.

"It’s not good for younger people in terms of learning. ... It’s not good for spontaneity. It’s not good for creativity. It's definitely not good for the sharing of information. It slows down decision making. It politicizes management," he said.

Still, there are some positions that can be done remotely, others that require someone being there every day and others that can be some combination, he said. At time, workers need quiet places to do their jobs without interruption.

"It's job by job and that's what we're doing," he said.

How is commercial real estate faring?

“Its city by city, state by state," Dimon said. "You’re going to see some problems particularly in parts of California, Illinois, New York. Some places are doing quite well – Nashville, Austin.’’

Dimon said he is concerned about a new issue that has come up with commercial real estate.

"It will not be like anything you’ve seen before in the past," he said. "There's what we call shadow vacancies. The landlord will tell you 12% of my space is vacant, but he knows that 10% is not going to renew. He may be paid for two more years, but that’s vacant and probably will not be filled. There will be some issues in certain cities. You can repurpose some of it, it’s hard. It’s very costly. You can’t do it quickly.

"It might be easier to repurpose something here where you need more housing than parts of the country that don’t need more housing."

mawilliams@dispatch.com

@BizMarkWilliams

This article originally appeared on The Columbus Dispatch: JPMorgan Chase CEO Dimon says bank 'mostly expanding' even with cuts