NYT: Boom in Jobs, Not Just Houses, as Real Estate Drives Economy

[DeepModem Mom]

Boom in Jobs, Not Just Houses, as Real Estate Drives Economy
By DAVID LEONHARDT
Published: July 9, 2005

....Danilo Molina is one small part of what might be called the real estate industrial complex, the economic engine that has become one of the few reliable sources of growth in recent years. Encompassing everything from land surveyors to general contractors to loan officers, the sprawling sector has added 700,000 jobs to the nation's payrolls over the last four years, according to an analysis by Economy.com, a research firm.

Combined, the rest of the economy has lost nearly 400,000 jobs over the same span, which stretches back to the start of the most recent recession, in 2001.

For all its benefits, the newfound power of real estate has also left the country vulnerable to a housing slowdown, which many economists expect over the next few years. Residential housing now makes up 16 percent, or $1.9 trillion, of the gross domestic product and is the economy's largest single sector, slightly bigger than the industries and services that supply health care, according to Economy.com....

***

The economic growth of the real estate industrial complex has only added to its longstanding political clout. The housing and construction industries gave $167 million to campaigns during the 2004 election cycle, more than the agribusiness, defense, energy and computer industries put together, according to the Center for Responsive Politics in Washington....


http://www.nytimes.com/2005/07/09/realestate/09complex.html?hp&ex=1120968000&en=4d7154198099c88d&ei=5094&partner=homepage

[iconoclastic cat]

1. That means no unmolested space anywhere, ever again.

Let's colonize Mars!

[The_Casual_Observer]

2. 16% of the economy based on the "bigger fool" pyramid principle

Sounds about right in the "bush era".

[Sugarbleus]

3. All that and STILL so many people without a place of their own.

Whadda country!!! :puke:

[high density]

4. Yeah, thank God these jobs are there!

Because all of the scientists and other high tech workers who are losing their jobs in this country are going to want to jump into the subcontractor market or become loan officers. :crazy:

[still_one]

5. it is a distortion

first of all they have changed the way they calculate new jobs

second many jobs that are being created right now are part time or temporary for students working during the summer

most important once people have been unemployed more than six months they are taken off the list, so you don't know how many people are still unemployed after they fall off the roll

[varun]

6. Pseudo-jobs

These are not REAL jobs. What happens when the real jobs (like IT, manufacturing) are replaced by mortgage brokers, loan officers?

Who will qualify for the loan when everyone is a loan officer?

[bklyncowgirl]

7. Economy based on illusion

In the 90's we had an economic boom that was based on speculation on internet stocks.

Now we have an economy that's barely avoiding recession because of inflated values for real estate.

We are riding for a fall and it won't be pretty.

[scarletlib]

8. It's true here in Florida.

The economy in Palm Beach COunty is doing very well. There is a development of some sort on every corner it seems. I do think this is a major part of any econmic success in this county.

[LibDemAlways]

9. In Southern California

real estate is inflated beyond all reason and overdue for a big, recession-inducing fall. Prices have risen so high in my neighborhood that there is now a glut of homes on the market and they aren't moving. Who the hell wants to pay 700K for a 30 year old three bedroom fixer? Over a million for a tract house built five years ago so close to its next-door neighbor that a person has no reasonable expectation of privacy? Over a half million for a small condo sold "as is"?
That's the reality of the situation.

No one wants or can afford to buy a home under these conditions. There is only so much people will pay - including investors looking to "flip" these places for a quick buck. I see signs around here that the market has stalled. Price reductions can't be far behind.