Decline in financial and construction jobs

The recent slow down in the housing market is beginning to have huge effects on the economy in general. The housing market has a direct effect not only on the economy in a general sense, but on the job market as well. The state of California is largely affected by the slowing housing market. An article in the Union Tribune, on July 22, 2006 by Dean Calbreath, entitled, “State adds jobs, but more slowly,” gives facts and figures on our slowing economy.

“Although California continues to add jobs, a monthly decline in construction and financial hiring suggests that the state is beginning to feel the effects of the slowdown in the housing market. California added 11,000 jobs last month on a seasonally adjusted basis, according to data released yesterday by the California Employment Development Department. That’s a slightly slower pace than the weaker-than-expected U.S. job market, which added 121,000 jobs in May.”

These numbers are showing that the economy is slowing in general, according to Stephen Levy, director and senior economist of the Center for the Continuing Study of the California Economy. It’s not a recession, but the economy in the state and the nation is slowing, and I think it will continue.”

There are hundreds of different jobs and job categories, but two sectors that are very important to the economy are among the weakest. These two sectors are financial services and construction. Construction is seeing a decrease in the amount of jobs because of the slowing housing market, as is financial services. The financial sector was seeing the least amount of jobs in the loan areas, and this is also a direct effect of the declining housing market. People are not buying as many homes, so the job sectors that revolve around the housing market are seeing a decline.

“Nationwide, spending on private residential construction dropped 0.8 percent in May, according to the most recent data from the Associated General Contractors of America. In California, overall housing starts are projected to be 15 percent to 20 percent lower this year than last, according to a report issued this month by the California Building Industry Association.”

“Alan Nevin, the association’ chief economist, expects that single-family home construction will remain strong through most of Southern California. But San Diego, the San Joaquin Valley, the Sacramento region and the Bay Area are likely to have significant declines in housing starts, he said.”

Although the economy is slowing, the good news is that California is adding more jobs, just at a slower pace. The construction and financial services job sectors are on a slight decline, but experts do not think it will become too bad.

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