News That Local Call Center Is Closing Stuns Workers

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KILLEEN (April 22, 2010)—Sallie Mae’s decision to close its call center in Killeen, eliminating 500 jobs, left employees News 10 talked to Thursday wondering what they will do next.

Employees, who agreed to talk on the condition of anonymity, said the mood inside the center Thursday was sad.

"I'm still in disbelief," one said.

Another, who has worked for Sallie Mae for years, asked, “What do we do now?”

Sallie Mae announced Wednesday it will close the Killeen facility and another in Panama City, Fla. as part of a restructuring plan aimed at trimming 1,200 jobs companywide this year and 1,300 jobs next year.

Employees of the Killeen call center, which has been in operation since 1994 and is one of the city's largest civilian employers, were advised of the company’s plans Wednesday.

Sallie Mae said no jobs would be eliminated in Killeen for at least 60 days and said the layoffs could spill over into the first quarter of 2011.

Workers were told Wednesday they can apply for other jobs in the company.

Sallie Mae says it will offer the employees a minimum of four months severance pay, and will hold job fairs in an effort to help them find work.

"Whenever you have to leave one job, especially if it's a job you like and an employer that you like and a job you like and search for another one, that can be upsetting,” said Jon Kroehler, Sallie Mae’s vice president of customer service.

The company attributed the restructuring to legislation approved in March that ends the bank-based system of distributing federally subsidized loans to students.

The change was part of the reconciliation bill that also included health care legislation changes that the president signed at the end of March.

Rep. John Carter, R-Round Rock, who represents the Fort Hood area in the U.S. House, opposed the federal takeover of the student loan industry and predicted earlier that if the measure passed, it would mean job losses locally.

“I have been saying for months now that this takeover of the student loan industry would devastate local economies, and would cost people their jobs,” Carter said.

“This is exactly the sort of thing we don’t need at a time when unemployment is near 10 percent.”

“The administration claims to be focused on creating jobs, but this is more evidence that the policies they force down our throats don’t consider jobs and local economies in the slightest,” Carter said.

The announcement Wednesday came on the same day Sallie Mae, which is the nation’s largest student lender, said it earned a profit in the first quarter after reporting a loss a year ago.

After paying preferred dividends, Sallie Mae earned $240.1 million, or 45 cents per share, compared with a loss of $21.4 million, or 10 cents per share, last year, topping the 29-cents-per-share profit Wall Street expected.

Sallie Mae originated $7.7 billion in federal student loans in the first quarter, up 16 percent from a year ago.

Sallie Mae Web Site

Central Texas Workforce Job Site

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