Thursday, August 16, 2007

The Layoff Factor

UPDATE 08/22/07: L.A. Land reports that 38,000 layoffs have been recorded nationwide in the mortgage sector and another 20,000 in construction. Click link for whole story.

As y'all know, the aerospace layoffs were a major factor in triggering the last housing bust in L.A. and people keep saying that this bubble is different because that "lay off factor" is missing.

Except that today the L.A. Times reported that Countrywide may be laying off staff soon:

"A bankruptcy filing by the lender would make life uncertain at best for its 61,500 employees, about 15,000 of whom work in Calabasas and elsewhere in Southern California."

And Thousand Oaks based Amgen hinted at lay offs in its recent SEC filings. Amgen employs some 8,300 staffers locally.

Not quite the same scale as the aerospace layoffs but then again the last bubble didn't feature the same credit perils as this one.


James said...

Bring it on! Countywide blows I hope they burn.

Kate said...

Wow, James. I don't think you've considered the ramifications of the country's biggest mortgage lender going under. Countrywide holds 1 in 6 U.S. mortgages.

Anonymous said...

Those of you who were here in the late '80s will recall that in fact the housing bubble burst BEFORE all of the layoffs in the aerospace industry.

It added insult to injury, but we had wonderful employment before the previous bubble burst. The aerospace industry had nothing to do with it. That bubble imploded on its own, with the savings and loan scandal being the source of easy money.

Once again, it was, and is, HIGH HOME PRICES that are the cause of this.

Kate said...

Well, Anon, let's not forget about the Savings and Loan debacle.