Monday, August 18, 2008

Job growth

I'm working on an inventory/sales post. But lack of sleep (new baby) is delaying it.

But look what I found:

US job losses are here year on year. If that isn't a recession...

LA is leading the drop in jobs.
Houston is growing the quickest(no wonder the PDF was found on
DC is doing pretty well.

Got Popcorn?


The Anonymous said...

As I keep harping - I am convinced this is the big reason we are seeing nationwide discrepancies in the bubble bust.

This is the reason LA is imploding (high end too)

This is the reason LA imploded during the early 90s

This is the reason Prince William County (where all the immigrant labor lived) is down 40% YOY

This is the reason why the rest of the DC area is doing ok (relatively speaking)

If we start losing jobs, expect to see a big leg down in DC prices. Without it, I think its just mild to moderate drops from here on out.

bearmaster said...

How are you doing Neil?

Houston may be experiencing job growth right now due to the recent commodity boom. You might find this story amusing, but there is a mini-bubble boom going on in this area as a result:

20 year olds with no work experience making $70K on oil fields

If oil continues to reverse course and correct very hard and/or crash (maybe due to global slowdown), Houston and other commodity-intensive areas could pop too.

wannabuy said...


Houston is also taking LA's high end manufacturing sector. Will Houston have a recession too? Of course. Yes, it will be commodities based too. But I'm seeing manufacturing jobs by the THOUSANDS heading off to Houston.

The Anon. It is an interesting counter point. As I've pointed out before, I will post the good and the bad.

Due to the (near) end of the secondary mortgage market, its the high end that will be hit worst. Even DC went to high price to earning multiples. BTW, do you know the income spread of the new jobs for DC?

I'm in shock how many jobs LA lost. I know LA is in bad shape, but that was a little worse than I thought (for today, I'm still bearish for the future).

Got Popcorn?

The Anonymous said...

"Due to the (near) end of the secondary mortgage market, its the high end that will be hit worst. Even DC went to high price to earning multiples. BTW, do you know the income spread of the new jobs for DC?"

No doubt, but remember the credit crunch has already given us big drops in the high end Loudoun County. Sales and junk loan stats indicate that area got much more out of whack than close in high end (Arlington).

We are a year into this credit crunch and the discrepancy between the two high end areas has not narrowed. Everyone says, well, distressed market status will do it, or Jumbo spreads will do it, or Indymac failing will do it - yet it keeps chuggin along at 4-5 months of inventory, few foreclosures, etc.

Note - I have NO idea why this divergance started, but I have pretty much given up on the "credit crunch" evening the two areas out. Yes both areas may get worse, but the discrepancy will continue.

The question now (in my mind) is will job loss sink a market that seems to handle the lack of credit pretty well. As I see it, that is the only way to get the big drops in areas resistant to the credit crunch...

As to the income spread - unfortunately I do not know. If I had to guess (and its a pure guess), based on what I have been reading, the big winner is govt consulting/contracting type jobs. Average salary on those jobs is probably around 80K. Nothing to sneeze at for sure, but not probably enough to really afford close in housing prices.

wannabuy said...

Will a discrepancy continue? Sure. But now everything drops. If 80k is truly a typical salary... prices have a bit more to drop. We'll see.

I just see tons of aerospace (or skilled manufacturing jobs) going to the three major growth centers: Huntsville, Houston, and Colorado Springs.

This credit crunch starts to get interesting soon. (We're not yet in the really interesting 18 months. We will be within 90 days.)

Got Popcorn?