Most economists blame the messy bursting of the housing bubble for the Great Recession, yet it’s jobs that are discussed the most on the news.
So what is the relationship, if any, between jobs and housing when it comes to the future of the economic recovery? Is it one of those vicious cycles where people can’t get jobs until the housing market recovers, but with a shaky job market no one is buying houses to put an end to the decline in housing? Just reading that sentence is enough to cause a headache.
Recently Mint.com, a personal finance website, had a map showing the future of job growth around the country. Then a couple of days after that there was a map depicting the current state of the housing market. The job growth map was based on information compiled by NPA Services, Inc, a statistics company In Washington, D.C.
The map depicts job growth in the next 20 years in major cities all over the country. It neither indicates what sectors the future jobs will be in, nor does it give information for how NPA Services arrived at these numbers. The housing map was compiled with information from the National Association of Realtors.
According to the jobs map, Denver job growth by 2030 is expected to be 1.3 million and the current housing market there has improved with sales up 1.8 percent. Colorado has gone from being down in home sales more than 11 percent in 2008. Colorado’s current unemployment rate is 7.5 percent. With an unemployment rate better than national average it’s perhaps not a stretch to see job growth in Colorado.
Los Angeles is expected to increase jobs by 1.9 million in the next 20 years, but that area is still taking a hit in the housing market with prices down over 12 percent. Home sales have yet to come back statewide and California’s unemployment rate is 12.4 percent. It might take twenties years for California to hit its stride again.
Atlanta is supposed to be the job Mecca over the next 20 years with 2.5 million jobs heading to that city, yet housing hasn’t rebounded there, with home prices down over 16 percent. Sales are starting to come back after being down 6-10 percent in the state of Georgia, but Georgia’s unemployment rate is 10.3 percent. With home values so low, it could take awhile for this area to be out of the recession.
Texas, where the current unemployment rate is 8.3 percent, is expected to see significant job growth in most of its major cities in the next 20 years. The housing market in Texas also started to rebound at the end of last year.
The housing news for January is not good. The winter is historically not a great time to sell a house, and this winter has been particularly tough. According to the Commerce Department, housing sales were down 11.2 percent last month. There was a small gain in sales in the Midwest, otherwise this drop was seen in housing markets across the country.
It’s an interesting idea that the areas where housing is recovering will have jobs soon to follow, but at this point it’s just fancy graphics. As a special section in Time last year pointed out about the future of jobs in America, 20 years ago the Internet was hardly heard of, there was no blogosphere or Facebook. How can anyone know exactly what might happen to the job market in the next twenty years? We still have to get through this year.
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