Saturday, January 23, 2010

Housing bust keeps consuming California jobs -

Housing bust keeps consuming California jobs - "Payrolls shrank by 38,800, marking the worst month for job losses since September. The unemployment rate remained flat at 12.4%, but only because more than 100,000 workers left the labor force and are no longer counted. Many of them have given up looking for work or have moved out of state.

Economists expect the state's labor market to remain weak this year largely because the bellwether housing sector continues to struggle. Over the last two years, California has lost more than 1 million jobs."

Fred Pilot flagged this. The housing construction sector drove the economy for years, in large part because it employs so many people, and you can find many statements to that effect from the 1990s and up to 2008. It hasn't started to come back yet, despite blips of life here and there, and until it does I see no way for the US to have a real economic recovery.


Fred Pilot said...

Housing is certainly an important component of the economy and drives a significant multiplier effect for other purchases. But we can't rely so heavily on the housing sector for a robust and sustainable economy, particularly given the volatility of residential real estate given changing consumer and lender behavior.

Anonymous said...

See today's "Speed Bump" comic at regarding the housing bubble.