Unemployment rate down to 10.2% in San Diego County
Some may consider this good news, for others it doesn’t help their employment status. Either way, the unemployment number in San Diego County dropped to 10.2% in September from 10.6% in August. In fact, it’s not just San Diego that’s registered a drop in unemployment rates – it’s the whole State of California with a 12.2% rating in September, decreasing from 12.3% in August.
Let’s try and see what this means. First, there are some economists who warned that it’s not such a good idea to put too much stock in these figures because they were sourced from a government-conducted telephone survey of households, which is generally, a less accurate way of getting the information. It’s more logical to rely on payroll numbers which are based on data coming from a broad sampling of employers. Others believe, however, that a drop (even something this small) is still a good sign because at least, there’s minor movement in the right direction. It is also very possible that this slight drop is an indication that massive layoffs are beginning to taper off and slow down.
However, even if unemployment rates are going down, it doesn’t necessarily mean that new jobs will be easy to find. Experts are even speculating that the slowdown in unemployment rates means that the once-jobless have now found part-time jobs or jobs that don’t involve payroll, like consulting jobs for instance. Some may even have opted out of being part of the workforce for the meantime, in their frustration from trying to find a job. Others may have decided to return to school or enrolled in training courses to boost their resumes once the job market picks up.
The retail and services sectors are primarily two of the segments in the employment market where there are new jobs being offered. Retailers are being positive about sales and intend on providing good service to their customers, hence the new hires.
What does this mean if you’re thinking of purchasing real estate? Real estate prices are often driven by unemployment rates. If we’ve reached the ceiling or close to it for unemployment then it is safe to say we are at the bottom or close to the bottom of the real estate market. Prices can only drop so much while unemployment rises. Once employment starts to stabilize, you will see the real estate market start to bounce back. It may not bounce back quickly but it will come back. Try to take advantage of the San Diego real estate market.
October 21st, 2009 at 8:16 pm
I guess that is good news. Hopefully it come a lot lower then that. We are starting to add jobs here in the Fort Worth area also.
October 22nd, 2009 at 9:18 am
Yea! Unemployement dropped in San Diego, .4%, for the first time since record highs, and .1% in california. Folks, we are really cooking now! The recovery must be right around the corner. I better hurry up and run out and buy some property while the buyin is still good. Why do people do this . . ? This small percentage change could most likely simply be noise in the system. Look at any chart on any tracked data and it goes up and down. You need to wait for a trend before making conclusions like “Unemployment rate is down to …”. So why do they do it.? Because people hope by cheerleading and putting lipstick on a pig it will change other people behaviors and become a self fulfilling prophecy. Its in the real estate industries interest to talk up the economy so they can make some sales because it has sucked for the last year. Maybe thats why they do it. The statement that prices can only drop so much due to unemployment is false. I would hold off a few more months before i start concluding the picture is rosy. US unemployment is at record high and experts are predicting a new wave of mortgage defaults in non-subprime mortgages, even in areas like Del Mar. Good Luck!
TP
October 22nd, 2009 at 12:48 pm
Hmmm… I thought we had some good news here since our Economy is So Dependent on Southern California… (When you turn… we turn.)
But the:
“….because they were sourced from a government-conducted telephone survey of households…”
is generally not a traditional method of reporting unemployment numbers so I can’t much weight into it.
October 22nd, 2009 at 12:59 pm
Oh yeah, it’s not a lot of great news and hardly worth going out and getting crazy about. There is another wave of foreclosures coming and we will see more in San Diego County but I feel that the big wave has passed. Many other markets in the country are going to continue to hurt. Imperial County’s unemployment rate is 28% right now. It’s going to be years before they bounce back. San Diego has a lot of positive things going for it and we may see prices decline in some areas but I don’t see double digit depreciation like we have over the last 18 months.
October 25th, 2009 at 8:42 pm
Unemployment dropping has to be good news! Hopefully it keeps getting better!
October 27th, 2009 at 3:48 pm
Similar report in Brainerd Minnesota. It has been mirroring the real estate market. We have been seeing the percentage of unemployed lowering for a few months now. One downfall is that the unemployment benefits in our area are now not offered for an extended period of time. I’ll take the lower number of unemployed!
Lake Home Realtor´s last blog ..Winterizing Your New Home
October 28th, 2009 at 8:46 am
I had no clue unemployment in California was so high. I thought Michigan was one of the worst off, what with all of the automobile factories closing but I believe were just over 10%
October 28th, 2009 at 9:48 am
It is encouraging to hear that unemployment rates drops. It is hard time for all of us.
October 28th, 2009 at 11:34 am
Wow, that rate is pretty high, and I didn’t realize how lucky we are. Here in my town, our rate is around 4.3 percent. We have been skipped over when it came to the unemployment bug, but we are still struggling in the housing market.
October 30th, 2009 at 6:58 am
I accept that real estate prices are directly proportional to unemployment rates but still I have some doubts. When unemployment %age is dropping, would it take the real estate business stabilize instantly according to the percentage with the flow or it would take the necessary time with respect to other factors like NYSE to deal with? I don’t know am I clear to you?
November 1st, 2009 at 3:20 pm
Wow that is a pretty sad number. I have to say we may have you beat over here in SWFL. Cape Coral / Fort Myers was one of the worst hit during the housing market crash as I’m sure everyone knows. So any improvement at all is good at this point.
November 4th, 2009 at 2:21 pm
That is great news! I am uncertain if the unemployment rate is falling here in Oregon as well, but as far as where I work we have begun hiring again as well. Hopefully that number begins to fall much faster now.
Land For Sale´s last blog ..Texas Land for Sale | Ten Acre Property About 18 Miles Northwest of Valentine
November 4th, 2009 at 3:05 pm
I haven’t seen effect my industry too much, everybody is still struggling in the IT world. I think there may be an increase in the number of jobs in construction but non-construction jobs are still suffering.
November 5th, 2009 at 4:11 pm
first, a balanced blog from someone in the industry is a breath of fresh air…
next, to comment on a few of the comments…
MI is still way ahead of CA in Unemployment unfortunately.
UE tends to be a lagging indicator of economic cycles. In the case of real estate cycles, while there is certainly a correlation it’s only partly causal, imo….
a more direct factor is availability of credit.
of course, no job = no credit (in most times, lol)
for the foreseeable future it’s hard to see the banks being as liberal as they were in the recent past. it’s more likely they will be tightening up significantly as they try to dig themselves out of the giant holes they’ve dug for themselves.
lack of credit, and lack of willing and able servicers of debt will likely be a significant headwind in more expensive places were cash purchases are rare.
November 6th, 2009 at 3:41 pm
Its no better here in the uk! but just after hearing the profits of the company i work for have gone up, perhaps just perhaps things have hits its worse and its a long hard struggle to get out of it
November 8th, 2009 at 9:32 pm
I think the rate is somewhat higher because many people are not on unemployment or counted.