Since the housing market is so closely related to whether people can find decent jobs, here is the latest in our continuing series on Washington State employment statistics. Things are looking up… sort of.
Washington’s jobs picture was mixed in July, and revised data shows that the first half of 2006 wasn’t quite as red-hot as first appeared.The state added 8,700 jobs last month, according to seasonally adjusted figures from the Employment Security Department, but the unemployment rate edged up to 5.3 percent from 5.1 percent in June.
Evelina Tainer, chief economist for the department’s Labor Market and Economic Analysis branch, said the increase in the jobless rate wasn’t statistically significant. But since the rate was as low as 4.6 percent as recently as March, it’s worth watching.
…
Instead of the 6,900-job average monthly gain that had been previously reported, Washington actually added an average 5,400 payroll jobs each month between January and June."On the whole, I think the numbers are still looking pretty good," Tainer said.
8,700 new jobs is definitely better than the previous six months. However, it’s interesting to see exactly where those 8,700 jobs are coming from (and where jobs are leaving):
Wholesale and retail trade in the state showed the biggest job drops last month, respectively losing 800 and 1,000 jobs, since June.
…
Education, both public and private, posted the strongest gains in the month, a total of 6,200 jobs. However, Tainer questioned whether that was due more to the quirks of the seasonal-adjustment process than real growth, noting that those same sectors lost 6,400 jobs in June.
…
Statewide, professional and business services, something of a catchall category for white-collar jobs, added 2,200 jobs in July, with most of the gains coming in managerial, administrative and support jobs.Construction, which has been one of the mainstays of the state’s economy, lost 2,000 jobs last month, due entirely to declines in the heavy and civil-engineering sector.
In King and Snohomish counties, though, 3,000 construction jobs were added in July, and manufacturing added another 1,300 jobs.
The P-I offers some additional analysis:
The largest job growth occurred in government (up 4,200 jobs), education and health services (3,100 jobs) and professional and business services (2,200 jobs).Retail trade lost 1,000 jobs, financial services lost 300 and information lost 200.
So disregarding the odd fluctuation in education, we’re really only talking about a net 1,500 jobs. Not exactly an economy to write home about. However, there is definitely some ammunition in there for the Seattle is Special™ crowd, what with construction jobs decreasing statewide (by around 5,000 jobs!) but increasing in King & Snohomish. I also notice a distinct failure to mention what’s going on with jobs related to real estate. Presumably they were mostly flat last month. Particularly interesting to me is that retail is floundering. Perhaps the housing ATM is drying up, even here in Washington?
Whichever way you slice it, it’s pretty difficult to skew these numbers to fit a "Seattle’s economy is booming" argument. I think at best, we’re treading water right now.
(Drew DeSilver, Seattle Times, 08.15.2006 )
(Drew DeSilver, Seattle Times, 08.16.2006)
(Dan Richman, Seattle P-I, 08.16.2006)
OT, but important to those concerned about real estate up here. From Ben’s blog:
“Reflecting national trends, home sales in Washington dropped in the second quarter, Washington State University reported. The statewide decline in sales of existing homes was 12.5 percent from the second quarter a year ago.”
“Among Washington’s largest counties, King County sales declined 13.7 percent, Pierce County slipped 10.7 percent, Snohomish County slid 11.8 percent, and Spokane County declined 11.9 percent.”
Yes folks, you read that right, King county sales DOWN 13.7% It is getting harder and harder to life the pom poms.
They also mention that only recent buyers will be hurt, I beg to differ.
Here’s the link:
http://tinyurl.com/p4k9p
As a matter of fact, I was just officially laid off today from Shurgard resulting from the (queue the Star Wars music when Darth’s on the scene) aquisition by Public Storage. Been laid off twice in the last two years in two different industries. Now I get to rub elbows with the Onyx and WaMu (and soon Weyerhauser) folks who are newly laid off and hitting the pavement shlepping resumes. UW research funding has been slashed and is at an all time low…there are literally dozens of doctors who worry their labs are going to go under.
Whew! Thank goodness I can snag one of thousands of new Microsoft jobs they’re about to create, right guys? (crickets chirping)
Guys?
Sorry to hear that emcityjill.
What type of work did you do at Shurgard?
I worked with the real estate development team. Ha!
Incidentally…What a great place to work! What a true shame that it was acquired (a hostile takeover in every sense) by such a second rate outfit. The CEO of Public Storage actually said at a meeting with Shurgard managers that he was thrilled with the acquisition because “this business (meaning storage REITs) pukes cash”. Pukes, dukes! I have never been more turned off by a CEO’s address.
Another heart-wrencher is what they’re going to do with our gorgeous historic building on South Lake Union. When I left for lunch today, Public Storage was literally changing the locks on our front door! Paul Allen for years has been rubbing his hands drooling trying to finagle that building for his pet project. Now I hope he finally gets it, though I’d rather see it go to Fred Hutch than be made into condos. Did you know that it’s one of only a few buildings built by Henry Ford on the west coast? Quite a piece of property!
Ah well. Life goes on!
Somebody explain to me please how prices can continue to increase if fewer folks are buying? Kind of seems as though sellers are living in la la land.
A house is only worth what someone is willing to pay for it, Meshuganut. Sellers will adjust once they pull their heads out.
Wow emcity. How long have you been there?
Layoffs can be traumatizing, but you seem to have a good clear head on your shoulders…are you going to take some time off, or go right back into a job hunt?
I’m strafing the market with my resume as we speak. I’ve gotten a few bites here and there, mostly mechanical engineering and construction companies, which I’d prefer to stay away from. I’d love to get into transportation, namely Expeditors Int’l. I’m taking a month to go to Spain, and hope to start a new job in November.
As for traumatic layoffs, I developed a thick skin from working in biotech. Hee!
Incidentally, on King5 news this morning I heard a report that average annual bonuses this year are LESS than inflation (I think they quoted average bonus to be 3.5% of salary). What a joy to be employed in Seattle! Hurray!
Have fun in Spain emcity, it is one of my favorite places on the planet.
Emcity…
Sorry to hear about the layoff. Have you ever considered networking as a source of opportunities?
Usually when people find out you are looking they bend over backwards trying to help you out. Especially the more they see you around.
Attending Toastmasters (TM) http://www.toastmasters.org is always a good place to meet quality (and often influencial) people; maybe a good place to start.
I have quite a bit of experience networking and would be glad to offer help/advice.
Dukes has it right, every market that has declined significantly has seen an increase in median price while sales start falling off.
Why? My guess is that both buyers and sellers are riding the last emotional wave before the crash.
“UW research funding has been slashed and is at an all time low…there are literally dozens of doctors who worry their labs are going to go under.”
That Times article hit really close to home for me — I’m a PhD student at the UW, and I know many faculty members sweating out the next grant. When that happens, the rest of us sweat too — there’s already been an uptick in pressure for graduate students to teach for their money (as opposed to research assistantships, which are the tradition) and that isn’t a good sign.
If UW research funding continues to fly into the ground, there’s going to be a steaming crater in the local economy. Despite what you may have heard, there isn’t nearly enough biotech in the region to absorb all of the lab techs, post-docs and unemployed faculty that will flow from the UW in a panic.
The basic argument that if jobs are strong the local real estate market will flourish is just half of the equation. The other half is obviously housing prices (affordability). I personally think the most interesting measure to track would be some kind of ratio of (job growth + income growth)/affordability.
“Whew! Thank goodness I can snag one of thousands of new Microsoft jobs they’re about to create, right guys? (crickets chirping)”
(Reposting this from bubbletracking)
I work at MSFT, supposedly one of the unstoppable engines of job and income growth fueling the housing market. It’s steady enough, but hardly the money fountain needed to support these runaway prices. Raises here have been mostly sub-inflation (~3%) for years, and people freely admit that homeownership has been far more lucrative than their income.
Also, the bulletin boards are suddenly crammed full of ads to sell or rent houses and condos. Guess those bidding wars are a thing of the past.
“Dukes has it right, every market that has declined significantly has seen an increase in median price while sales start falling off.”
Exactly. Thanks to Ben’s blog, we’ve long since seen how that story ends. No different than a stock peaking on declining volume as the last of the bagholders pile on.