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alstry (35.68)

When is it too many jobs????

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July 07, 2008 – Comments (2)

(MarketWatch) -- General Motors Corp., the Detroit auto maker, is preparing to cut thousands of additional white-collar jobs and is mulling whether to sell or close more brands, people familiar with the matter told The Wall Street Journal. GM's stock price is at a half-century low.....

From the WSJ-...open-air retail venues such as big-box centers and grocery-anchored strip centers. Vacancy in those formats climbed from 7.7% to 8.2% in the second quarter, the highest tally since 1995.

As many of you know, I have been documenting job loss announcements for the past four or five months.  It appears GM is contracting again, after contracting again and again.  So are retailers and a variety of other industries.

If this trend keeps up, at some point we are going to shut down enough business and lay off so many workers there will not be many left to make purchases and pay taxes.  For those that are capable of paying, the burden will be enormous.

2 Comments – Post Your Own

#1) On July 07, 2008 at 8:06 AM, saunafool (98.68) wrote:

I hate to be a negative nelly, but your methodology is sure to produce a dire outlook. If you only track job losses, of course you will end up believing the world is coming to an end.

There is a huge headline bias to feed this. Big corporations announce big cuts in the number of jobs--5,000 at a time or more. Meanwhile, companies that are adding employees almost never say "XYZ Corp plans to add 25,000 jobs this year."

While homebuilding, finance, retail, and automotive contract, there tons of jobs in energy, mining, and related industries. Talk to a pump or compressor manufacturer and ask how business is doing. They have backlogs stretching for a couple of years, which is the best it has been for nearly 25 years.

On the whole, however, you are right about the trend, retailers and construction create much more employment than pipefitting and roughnecking. I don't think anyone has a clue of when the "bottom" of the current cycle will occur or just how far down it might be. 

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#2) On July 07, 2008 at 8:48 AM, alstry (35.68) wrote:

Compared to healthcare, construction, finance and retail....there are relatively few jobs in energy and mining.  For fun take the top twenty energy companies and add up the total number of employees.  Then if you add in the jobs affected by each area...the divide grows wider.

Over 100% of job growth between 2002 and 2006 was related to construction, healthcare, and finance.  I am aware of the strength in energy and mining....now the question is whether that strength will continue as the economy continues to slow worldwide.

•German, British Manufacturing Drop as Economic Growth Slows Across Europe

At the end of the day, if you don't have a job, you are not buying a house, a car, or paying taxes.

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