The wholesale lender's workforce went from 8,000 employees in 2021 to 6,000 in 2022 but increased to 6,700 staffers in 2023. This staffing strategy requires careful planning, as new hires are made months in advance to align resources with the company's long-term needs. Over the past couple of years, UWM has prioritized hiring, training, and developing its workforce despite the cyclical nature of the mortgage industry, and rather than following the fast hire-and-fire trend, this approach has been more sustainable.
Mortgage companies are now approaching hiring with greater caution after experiencing a hiring frenzy in 2020 and 2021 followed by widespread layoffs. The number of active loan originators in the country has significantly decreased, dropping from 181,656 in Q3 2021 to 89,094 in Q2 2023. This reflects the changing attitude towards hiring in the industry, as lenders are now more conservative in expanding their workforce, recognizing the impact of fluctuating financial health on their hiring strategies.
The share of retail lenders reporting pre-tax net income has seen a notable decline, falling from 92% in Q3 2021 to a low of 25% in Q4 2022. Yet, there has been a bounce back, with 78% reporting profitability again by Q2 2024. This financial recovery is crucial for instilling confidence in the hiring processes of mortgage companies, indicating a possible shift towards more optimistic market conditions.
According to recruiter John McKenna, the demand in 2020 and 2021 was overwhelming, with lenders needing a high number of underwriters and processors almost overnight to respond to the unexpected market conditions. McKenna notes, 'Nobody was prepared for 2020 and how the rates dropped,' signifying a sudden need for a robust workforce that internal recruiting teams struggled to manage.
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