The Tampa Bay area's coveted financial services industry suffered another damaging blow Wednesday when JPMorgan Chase & Co. announced that it will close its credit card call center by the end of the year and eliminate 1,900 jobs.
The news, long rumored, was denied by company officials for months until employees were notified in "waves" during midmorning gatherings. It comes just six months after Capital One did the same thing, closing its credit card call center in Tampa and releasing 1,100 workers.
But unlike Capital One, which said it had hired another company to handle its call-center functions more cheaply, JPMorgan said it will absorb the work being done in Tampa through several in-house centers operating in other cities, including Orlando.
Employees and community leaders had been bracing for just such an announcement since JPMorgan Chase merged with Bank One a year ago, creating a glut of call center space and staff for the financial services giant.
"When you have duplicate sites, that's not economy of scale," said Kim Scheeler, president of the Greater Tampa Chamber of Commerce.
"I would have loved to see those jobs stay in Tampa (but) I'm not totally surprised. . . . Bank One had a much larger credit card operation than JPMorgan Chase did," Scheeler added. "The good new is we've still got a big chunk of JPMorgan Chase employees here."
Even with the pullout, company officials said it will still have about 3,100 Tampa Bay area workers involved in mortgage, automobile finance and a Treasury and Security Services unit. JPMorgan has its offices in a campus-like setting at the Fountain Square Complex on Independence Parkway near Tampa International Airport.
"Qualified employees (losing their jobs in the credit card unit) will continue to have first consideration for all open positions" in remaining Tampa units and elsewhere in the organization, company spokesman David Chamberlin said.
With area unemployment at 3.2 percent, Scheeler said he was confident the remainder being laid off will find work, particularly since JPMorgan Chase indicated many workers would stay on its payroll through most of 2005.
Like Capital One, the Chase Credit Services operation received millions of dollars in tax incentives for creating the jobs that are now vanishing.
In June 1997, the company pledged to add 1,330 jobs in the Tampa credit card center, which handles customer service, debt collection, technology support and fraud. In return for the promise, JPMorgan Chase was eligible to receive payments staggered over 10 years of up to $5-million in reimbursements under the state's Qualified Target Industry Program for state taxes paid.
QTI, as the program is sometimes called, was created in 1994 by the Florida Legislature to lure companies with high-paying jobs through the use of tax incentives.
As of June, JPMorgan Chase had received more than $3.1-million through QTI, state records showed.
"It's possible they may not receive any more reimbursements," said Scott Openshaw of the governor's Office of Tourism, Trade and Economic Development, which approves state incentives.
JPMorgan has earned tax incentives for its other divisions as well, among them nearly $1 million for its treasury operation and another $274,000 for its trade services subsidiary in a program that could net the company $4 million if it meets job-creation goals. Another JPMorgan subsidiary has so far been paid $175,000 in incentives that could total $2.5 million if the company creates enough jobs in billing services.
In recent years, the company downsized its Tampa presence in bits and pieces.
In 2003, it shut down a Tampa unit that handled mortgage telephone sales and loan processing, displacing 235 employees. More recently, it told state officials in October that it was laying off 125 Credit Services workers involved in collection and risk control.
Groups get the news
Upper-level employees at the company's five-building complex on Independence Parkway were told about the latest and biggest layoffs in a series of briefings Wednesday morning. The managers, in turn, assembled employees in small groups to share the news.
"They're going in waves (into notification meetings) and yes, it has started," Chamberlin confirmed mid-Wednesday morning.
He would not provide specifics on employee salaries, severance packages or the timing of the phased shutdown, except to say no workers were receiving a 60-day notice Wednesday.
Security guards were seen patrolling the Fountain Square office park midday, where about a dozen J.P. Morgan Chase employees declined to comment on the pending layoffs.
In a memo distributed to employees, Chase Card Services chairman Bill Campbell and chief executive Rich Srednicki pledged to try to find other positions within the organization for as many workers as possible, both in Tampa and other U.S. locations.
"We are committed to offering employees the highest level of support," the executives wrote. "Still, we recognize the disappointment these decisions create for our colleagues in Tampa and the change they will present for a number of others. Please know that we made these decisions with great care."
Deflecting rumors that the work will be going to India or other centers outside the U.S., Chamberlin insisted, "No, we will not be offshoring these jobs."
Rather, the work will largely be shifted to existing U.S. credit card centers in Maryland, New York, Delaware, Texas, and possibly nearby Orlando, among other sites, Chamberlin said.
In their memo, Campbell and Srednicki also indicated some workers may find "good job opportunities" as duties are shifted around offices in Columbus, Ohio; Tempe, Ariz.; and Elgin, Ill.
The credit card office complex includes three main buildings totaling about 500,000 square feet _ known as Fountain Square I, II and III _ and two additional buildings across the street.
Among on-site amenities are aa cafeteria and day care center. Workers field calls in large cubicles with plenty of natural light. Break rooms and common areas have television monitors with CNN airing constantly.
One structure, a 126,000-square-foot building, has been on the market for two months, JPMorgan Chase executives said. Chamberlin said no decision has been made on whether to sell any other part of the complex, which will continue to house many of its remaining employees. The company also owns two more buildings in the bay area and leases one.
Times staff writer Louis Hau contributed to this report.
TAMPA BAY LAYOFFS
The biggest blows to the local job market in 2004:
1,400 JOBS: Lost when Eckerd Corp. headquarters closed in Largo.
1,100 JOBS: Lost when Capital One call center closed in Tampa.
459 JOBS: Lost at Pasco Beverage in Dade City.