Student debt is on the rise in the U.S.
A Minnesota-based student loan management nonprofit will be laying off 185 employees from its Sacramento operations and relocating its local office.
Education Credit Management Corp., also known as ECMC, will be making the layoffs by the beginning of August, according to California Employment Development Department records.
ECMC is the guarantor of federal student loans through the Federal Family Education Loan Program and works out of an office in Mather.
Jan Hines, president and CEO of ECMC, said the Mather office will be closing and the remaining local workforce of about 40 employees will relocate to a smaller location in Rancho Cordova.
The United States government no longer issues loans through the FFEL Program. Since July 2010, all new federal loans have originated from the Direct Loan Program.
ECMC does not work with borrowers through the Direct Loan Program, which means the corporation has received no new business since 2010, Hines said.
“Our portfolio is aging, as one would expect,” Hines said.
Hines said ECMC has made similar consolidation efforts elsewhere in the past few years.
The local layoffs span a variety of positions, including 45 accounts specialists, 42 loan repayment counselors, three directors and two vice presidents, according to EDD records.
All of the layoffs will affect full-time employees, according to EDD records.
Sacramento employees may be able to work in Minnesota if they are qualified for open positions there, Hines said. Severance and other assistance packages are available as well, she said.
“One of our goals is we really want to take care of our Mather employees in this transition,” Hines said.
She said ECMC does not currently have plans for further layoffs in the Sacramento area.