Thursday, March 23, 2006

The Downside of the Housing = Jobs Equation...

We are currently in the midst of our own little housing boomlet in Jefferson/Lewis Counties thanks to the current/proposed expansion of Ft. Drum. While we live in a pretty insulated part of the world north of Syracuse, we can not ignore the economic situation around the country. I've discussed the housing = jobs equation before, but it was recently covered in USA Today...

"With the allure of easy money, thousands of Americans flocked to jobs in the real estate industry during the boom years. ...As the housing market slows, there will likely be a lot of stories of people who are bailing out of their real estate jobs and other professions related to housing — appraisers, mortgage brokers and home construction workers — and many not by choice.

This could send shock waves through the job market and the economy. That's because housing helped drive the economy out of the last recession. Almost four out of every 10 jobs created in the past four years were in housing-related fields. At the end of last year, a record 9.8% of U.S. workers were employed in the real estate industry, up from 8.2% a decade ago, according to Moody's Economy.com. "If we don't get the job creation that we need to sustain spending, the economy could be in trouble as we get into '07," he says.

While New York registers a rather modest 8% of our jobs from real estate related fields, I'd note that a the income generated by those jobs can often be substantial (particularly downstate) and those high incomes help bolster our overall tax receipts. If we and other states around the country start to lose high income jobs (and their associated tax revenues) state budgets could be in trouble for 2007 and 2008.

A special welcome to all of you that have found me via Newzjunky.com. It is an indication of the power of Newzjunky when traffic spikes 2000% simply because of a link on his page. Thanks for visiting and please add your comments, questions or suggestions for future topics you'd like discussed (mortgage rates, stock trends, currencies, debt issues, etc?)....

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