Layoffs mostly occur in default to get rid of higher salaried employees with years of merit increases behind them. It's an opportunity to bring in younger and much cheaper employees to fill their positions.
Lay offs for default servicing positions usually only occur en masse as a result of divestiture or betting big on MBS and losing your shirt. This is because, as layoffs suggest, its a tough economy out there! In a tough economy you can bet other companies are looking to do the same.
More layoffs mean more consumer defaults, which means more default work