Now the housing slump is hitting yet another target: housing-related jobs, a list that includes everyone from the people who build and sell houses to makers of appliances and furnishings.
That's a sharp contrast to the height of the housing boom in 2005-06, when the industry was responsible for creating some 25,000 to 50,000 new jobs every month, according to Mark Zandi, chief economist at Moodys.com.
“In the recent months it’s been laying off workers at a pace of 25,000 to 50,000 per month,” he said. “And I think the next couple of quarters we’ll start seeing job losses of between 50,000 and 75,000 per month. ... I think the housing market is going down a whole other notch.”
I looked at housing and employment about 6 months ago. A conservative reading of job growth puts housing related jobs at about 30% of total growth for this expansion. That's including construction, financial and professional services. In other words, housing is really important to this expansion.
The blog Calculated Risk has estimated that between 200,000 to 400,000 jobs will be lost as housing cools. Additionally, we really haven't started to see the big drop because housing starts are just starting to slow. Business construction may absorb some of these losses, but as of now we don't know how many.
3 comments:
mexico may absorb some of those losses as undocumented illegal aliens go home because there is no work here for them. I suspect that being the first to be fired, its one reason why we have seen so little impact so far.
as you may remember, bonddad, mrs. skippy and i are in the market for a condo here in los angeles.
our real estate agent told mrs. skippy that she (the agent) recently attended a seminar which warned that the collapsing real estate market in socal will have a domino effect in job losses via real estate agents, mortgage brokers, contractors & the like.
so if the real estate industry is nervous about its own economy, what chance do the rest of us have?
Actually Calculated Risk is calling for 400,000-600,000 lost construction jobs by this summer... and his case is very persuasive.
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