MARCH 23, 2023 — 550 NEW LAYOFFS
In the company’s second mass layoff in the past two months, Nelnet announced 550 employees, most of them in its Nelnet Diversified Services division, will be laid off.
On March 22, 2023, Nelnet received a contract modification from the Department of Education (Department) for the company’s current loan servicing contracts with the Department. The modification significantly decreased the price earned by the company per borrower per month. Additionally, last month, the Department notified Nelnet of its intent to transfer 1 million borrowers from Nelnet Loan Servicing to another federal servicer. The transfer, which was not based on Nelnet’s performance, is scheduled to occur over the next few months. Both the price reduction and the unanticipated transfer of a million borrowers will have a material impact on NDS.
Approximately 550 associates who work in Nelnet’s Diversified Services (NDS) division and some in related shared services areas that support NDS were notified today their positions are being eliminated. Nelnet will also look for redundancies and efficiencies throughout the year related to the conclusion of projects centered on the consolidation of select loan servicing platforms. No other Nelnet businesses are impacted.
“Of all the strategic business decisions we must make, the rightsizing of teams is always the most difficult,” said chief executive officer Jeff Noordhoek. “While some terms of employment end knowingly because the specific work is completed, other unanticipated staff reductions are the result of challenging circumstances that have a significant impact on the business. We must adjust accordingly to continue providing value to customers to the best of our ability while also positioning the company for long-term success.”
JANUARY 20, 2023 — 350 LAYOFFS AND 210 TERMINATIONS
The company announced changes to manage excess staff capacity due to delays in the government’s student debt relief and return to repayment programs. Approximately 350 associates hired within the last six months will be laid off, and approximately 210 associates will be terminated for performance reasons in the company’s Nelnet Diversified Services (NDS) division.
The approximately 350 associates who will be laid off were hired within the last six months for the primary purpose of meeting the anticipated increase in student loan borrower activity, which was further delayed.
According to a company spokesperson, “These decisions are never easy. With the delay of federal student loan repayment through much of 2023, regrettably, it isn’t feasible to maintain increased staffing levels for work that will remain on hold for a significant amount of time.”
JUNE 6, 2022 — Original blog post…
Lincoln, Nebraska-based Nelnet, a financial services company specializing in the administration and repayment of student loans and other education financial services, has announced a reduction in force in response to lower work requirements.
The reduction in force has impacted 150 employees, located in 30 processing centers countrywide.
According to a company spokesperson, “Due to the federal government’s multiple extensions of the CARES Act relief period, federal student loan borrowers have not had to make loan payments since March 2020. As a result, our loan-servicing teams have been experiencing extremely low call volume and limited work available.”
“Now, more than two years later and with the most recent extension continuing through Aug. 31 — with no certainty as to whether or not the relief will be further extended — we have excess capacity in our loan-servicing teams, thus the need for right-sizing.
As of Dec. 31, Nelnet was servicing nearly $480 billion worth of federal loans for more than 14 million borrowers.
According to Nelnet CEO, Jeff Noordhoek, "We are proud of our team of associates who are truly responsible for our success. Their perseverance, optimism, and, most importantly, dedication to our customers through the current economic and political challenges and uncertainty is remarkable and gives us confidence for the future."
Change is coming. There will always be a tomorrow, no matter how much you may try to ignore it. There are no guarantees in life or promises for a bright future. Just because something bad hasn't happened yet, doesn't mean it won't. It can happen to anyone, anytime, anywhere. No one is guaranteed to wake up tomorrow and still have a job by evening. Are you now wondering, Am I Next?
