A (Macro) Tale of Two Jefferson Counties [Housing Tracker]

Macro Effects of the Housing Slump

Hard Times Hitting Students and Schools in Double Blow. Louisville, Kentucky: “With mortgage foreclosures throwing hundreds of families out of their homes here each month, dismayed school officials say… record numbers of students turning up for classes this fall are homeless or poor enough to qualify for free meals… At the same time, the district is struggling with its own financial problems. Responding to a cut of $43 million by the state in education spending and to higher energy and other costs, school officials in Jefferson County have raised lunch prices, eliminated 17 buses by reorganizing routes… and increased property taxes.” (NY Times, Aug. 31) 

A Bankruptcy Filing Is Looming For Jefferson County, Ala. Birmingham, Alabama: After months of failed negotiations with creditors and counterparties to its troubled sewer debt, Jefferson County, Ala., could face bankruptcy... The county… isn't expected to meet a Friday deadline for an interest payment, after numerous extensions… If the county defaults it would be the largest-ever municipal bankruptcy… [It] would put a spotlight on two monolines -- FGIC Corp.'s Financial Guaranty Insurance Co. and XL Capital Assurance Inc. -- which have a combined $2 billion in exposure to the county's sewer debt. XL Capital is a wholly-owned subsidiary of Security Capital Assurance Ltd., now known as Syncora Holdings Ltd.” (WSJ, Aug. 29)

California Moves on Bill to Curb Sprawl and Emissions. “California is close to adopting a law intended to slow the increase in emissions of heat-trapping gases by encouraging housing close to job sites, rail lines and bus stops to shorten the time people spend in their cars… The measure would loosely tie tens of billions of dollars in state and federal transportation subsidies to cities’ and counties’ compliance with efforts to slow the inexorable increase in driving. The goal is to encourage housing near current development and to reduce commutes to work… The fragile coalition behind the measure includes some longtime antagonists, in particular homebuilders and leading environmental groups in California.” (NY Times, Aug. 28)

Construction Jobs Hard To Come By This Summer. “Homebuilders [sent] 22,000 more construction workers to the unemployment line… The industry's July unemployment rate of 8% is the highest in 13 years. Across the nation, some 783,000 jobless laborers, carpenters, plumbers, pipefitters and other tradesmen are looking for work wherever they can find it… Since its September 2006 employment peak, the construction sector has lost 557,000 positions. Nearly three-quarters of those lost jobs occurred after October 2007… Since July 2007, the number of part-time construction workers who want full-time work has jumped by 249,000, or 40%. That's the most among all industries, said Steve Hipple, a Labor Department economist.” (Kansas City Star, Aug. 26)

Louisiana Up 32,700 Non-Farm Jobs In Past Year. “Louisiana Workforce Commission: Louisiana gained 32,700 non-farm jobs from July 2007 through July 2008 as the annual growth pace jumped a bit from the previous month. On a non-seasonally adjusted basis, about half of the gain - 16,300 - came from the New Orleans metropolitan area, which is still trying to recover from huge job losses from Hurricane Katrina. Goods-producing jobs increased by 3,300 over the year, almost entirely due to the construction sector… Between June 2007 and June 2008, the job count rose 24,800.” (Forbes, Aug. 25)

Jobs Optimism For East Bay, But Not Till ’09. California:“Economist Ryan Ratcliff of the UCLA Anderson Forecast: The East Bay lost 2,700 jobs in July, excluding expected seasonal losses, continuing a seven-month decline led by the construction and financial services sector… Construction, which has lost 6,500 jobs y/o/y, mostly in specialty trade contractors and residential building, added 700 jobs in July, slightly below its usual average gain of 900 jobs in the month… East Bay Economic Development Alliance: An important part of the recovery will come from the retraining of workers who have lost jobs in the residential construction and financial services sectors for jobs in developing fields.” (East Bay Business Times, Aug. 22)

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