Nearly 88,000 financial industry workers -- 41 percent of them directly related to the mortgage sector -- have lost their jobs this year, according to the latest count by Challenger Gray & Christmas, a Chicago outplacement consulting firm.

Through Aug. 21, the company counted 87,962 financial jobs lost so far this year. And that's on top of the 100,000-plus who were let go in 2005 and 2006. Of this year's total, 35,830 were in the mortgage business.

More financial industry workers were given pink slips in April -- 33,789, to be exact -- than in any other month, the company said.

With few exceptions, the cuts are directly related to the nation's housing woes, said CEO John Challenger. More than 13,000 jobs were lost at Accredited Home Lenders, BNC Mortgage, Sun Trust, First Magnus, Countrywide and Capital One.

"The mortgage industry (has) basically told their loan officers and call centers representatives to simply stop taking calls," Challenger reported. "They basically stopped on a dime."

Challenger said there are "two big issues" behind the cuts. "First, demand for new mortgages and home equity loans and other forms of credit have fallen off dramatically. The other issue is the increasing rate of defaults and foreclosures, which is leaving the lending institutions unable to meet their own financial obligations."

The situation is worsened, he added, by the fact that other financial institutions not directly associated with housing have been investing billions in mortgage-backed securities, which has made them extremely vulnerable to the turmoil in the housing market.

The employment fallout so far this year is 164 percent greater than though the end of August 2006, the company said. And the carnage isn't limited to the financial sector alone.

Realty companies are one casualty. Real estate firms have announced 1,950 job cuts so far this year, the consulting firm reported. But that doesn't include "hundreds, if not thousands" of independent agents who have simply stopped working because there are no buyers, Challenger pointed out.

Another big victim are construction companies, which have announced 19,670 layoffs, a figure that also is underestimated because most crews are small, independent subcontractors.

The firm also is seeing job cuts in companies that provide construction equipment, materials and suppliers as well as furniture makers and other manufacturers of home furnishings, paint and household products.

"The end of the housing-related job cuts (is) by no means in sight," Challenger said. "It could be months before we reach the peak."

Published: September 5, 2007

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When Lew Sichelman first started writing about housing in 1969, he was the youngest real estate writer in the country. Now, 37 years later, he's one of the oldest -- and most decorated. He has been rated the top housing columnist in the country by the National Association of Realtors as well as by his peers in the National Association of Real Estate Editors. Indeed, NAREE has recognized his work on numerous occasions. One year - due to his advancing age, he can't recall which one - he earned top honors in the annual NAREE Journalism Contest in three out of the four major writing categories. It was the first time one writer has won so many NAREE awards in a single year. Known for his ability to make even the most difficult topics understandable, Sichelman also has been honored by the National Association of Home Builders and the Mortgage Bankers Association. He began providing in-depth coverage of and consumer-oriented information about housing and housing finance at the Washington Daily News, where he was real estate editor. He held that same position for nine more years at the Washington Star, which purchased the News in 1972. The Star, a so-called "writer's newspaper" which also had the misfortune of being an evening paper, was put out of its misery in 1981, and Sichelman, who had begun self-syndicating his column in 1978, decided to become a full-time columnist. Today, his column, "The Housing Scene," is distributed by United Media to newspapers throughout the country. He also is on the staff of National Mortgage News, an independent newspaper which is considered the bible of the mortgage business. And he writes for numerous other publications, including MarketWatch.com, where he answers readers questions once a week, Sports Illustrated (don't ask), RealtyTimes.com, BigBuilder and others. Sichelman is married, the father of five and grandfather of eleven.