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The Joint Center for Housing Studies at Harvard University estimated that the decline in new and existing home sales of almost 10% in 2006 has already led to about 100,000 job losses, and will lead to further job losses in 2007 because the full impact won't be felt until late this year. January housing starts were the lowest since August 1997. Housing and related industries account for about 23% of the economy, according to the center. Industries suffering from the housing slowdown include furniture, construction supplies, domestic appliances, and plumbing. Recent announcements of job cuts include 4,500 by plumbing and heating equipment firm Wolseley plc, 4,500 by appliance manufacturer Whirlpool, 8,000 by paint and faucet manufacturer Masco, and smaller cuts in housing related manufacturing by Emerson Electric and Stanley Furniture. Caterpillar recently forecast "sharp declines" in earth moving equipment in 2007. Copper prices are down 35% since their May record and inventories are up fourfold since July, as the construction slowdown reduces demand for pipes and wires.

Sources: Harvard University Joint Center for Housing Studies, Bloomberg
Conference Call Transcripts: Toll Brothers Earnings Call Transcript
Commentary: Toll Brothers: Earnings Drop 67%, Beat EstimatesHousing Bubble and Real Estate Market TrackerNAR Hoping Semantic Games Will End Housing Slump
Stocks/ETFs to watch: Masco (NYSE:MAS), Whirlpool (NYSE:WHR), Emerson Electric (NYSE:EMR), Wolseley plc (WOS), Stanley Furniture (NASDAQ:STLY), Caterpillar Inc. (NYSE:CAT)

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Source: Housing Slowdown Hitting Other Industries With a Lag