In case you missed it, Part 1 of this series looked at housing demand fundamentals and demographics and Part 2 examined housing affordability. Today in Part 3 I will introduce a new-to-me-at-least and improved measure of housing and related industries.
Our office has routinely discussed housing related employment in the past few years, particularly as housing had been one of the two major drags on the economy (along with government). This previous measure our office used included construction workers, mortgage brokers, real estate agents and home improvement stores. While these are all components of the housing industry, it is certainly an incomplete measure. As I am working more on industry clusters (note the High Tech report is delayed until September when it will be released alongside an Employment Department report) I have been able to flesh out the housing related industries to include more individual sectors of the economy tied to housing than previously discussed by our office.
However, others have used a broader and more complete defintion of the industry. The following comes from both a U.S. Bureau of Labor Statistics’ research report and also the sectors identified by Trulia’s Chief Economist, Jed Kolko. Employment’s Regional Economist, Guy Tauer, has also used this definition a number of years back as well when discussing Southern Oregon. Furthermore, due to data availability at such detailed industry levels, I am using the QCEW data and even as the vast majority of workers are covered under the UI system, this does represent a slight under-count of the total number of workers in the industry.
Note that at the national level one is able to disaggregate the construction sector employment into sub-industry components (e.g. just look at residential construction employment) however at the state level in Oregon this is may or may not be a reasonable action to take given data availability and the much smaller sample of firms and workers. I am counting all construction workers for these purposes.
Prior to the housing bubble housing and related industries accounted for a bit more than 10% of statewide employment, whereas at the national level these sectors accounted for about 8.8%. At the height of the housing boom these industries were 11.3% of Oregon employment and 9.6% of U.S. employment. Since the crash and the depths of the recession these industries have been a consistent share of the overall employment at 8.1% in Oregon and 7.3% in the U.S.
Over the course of the Great Recession, housing and related industries lost over 30% of their jobs in Oregon and nearly 24% at the national level. Clearly these declines were substantially larger than total employment which fell nearly 8.5% in Oregon and 6.5% in the U.S. In terms of the number of jobs, at their peak these industries employed 195,300 in the state and fell to 129,600. Following some modest growth over the past 18 months, these industries employed 134,500 in December and given the recent employment reports have likely added another 4,500 jobs in the past 6 months (3,800 construction and approximately 700 in related industries). That growth overall represents over 9,400 jobs since the beginning of 2011 or 7.3%. These housing and related industries gains are on par with nationwide gains.