Tuesday, November 25, 2008

the unDetroit?

Detroit's unemployment jumped from 8.5 to 9.0% in October. That story quotes the job loss in Detroit alone as a net employment drop of 17 thousand people between October 2007 and October 2008. Yet before anyone again jumps to any conclusions about what that could mean here, maybe it would make sense to first ask what the comparable employment change is for Pittsburgh? I would tell you, but nobody believes me these days so you might as well read it yourself.

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The auto industry miasma is driving a lot of bad news elsewhere. Last week there was a little bit about how US Steel us laying off 677 folks across all of North America. That probably came out to less than 100 folks here. I suspect there will be more to come, but in Indiana they are already there. Another steel company is looking at over 2,400 layoffs at a single plant there mostly because of the auto industry derived collapse in steel demand. That sure sounds familiar and are more Pittsburgh-like recession numbers. They know what we know that "Communities brace for ripple effect of steelworker layoffs", a headline that was probably written here hundreds of times. There is no sugar coating the state of the steel industry right now, though I did read about the Obama plan to ramp up infrastructure spending. Lots of infrastructure uses lots of steel.


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on casinos, which does not have a Detroit theme other than the fact that Detroit's Greektown casino is running out of cash... Not very long ago some folks were perturbed that the original losers in the casino bidding process didn't get a chance to rebid for the license that Don Barden sold off just this month. well... via Writes Like She Talks is a pointer to this blog entry about one of the two other bidders way back when: Forest City Enterprises is having it's own financial problems which is impacting its other projects. So Barden might have been a first mover into financial oblivion, but it's unclear any of the other original bidders would now be in a position to push our casino forward anyway.

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But back to real estate. Out yesterday was this article from the AP. According to ever more real estate metrics they compiled:

There were some bright spots among the Northeast cities in the AP-Re/Max report.Pittsburgh posted a modest year-over-year price gain of more than 1 percent in October, the only metro area to record appreciation. Its inventory also fell by a quarter from a year ago. However, sales there were down almost 27 percent.


Price up? "only metro".... "inventory down".... wait a second. Wasn't the local news on this recently reporting quotes from folks about how the lower number of sales being recorded must be pushing real estate inventory levels skyward exponentially. The implication that the prices are soon to be pushed down as a result.. Yet this metric says inventory is actually down substantially (down by a quarter is a lot and ought to be a pretty big story unto itself) despite lower sales? Something just isn't right. Somebody has something just plain backwards. If that data is even half right, then go back and re-read this story from last week on what slower rate of real estate sales mean for the region.

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As bad as the near term outlook for steel is, how about other manufacturing in town? There is even evidence that Westinghouse alone is having an impact across a number of local manufacturers who still are still more pressed to find workers than to lay them off. Not all good news of course and some local firms can't escape worldwide demand slumps in a lot of commodity products.

But there is a lot of positive news in the nuclear industry of late, impending worldwide depression or not. See for example how just an order placed by Westinghouse for some nuclear power plant components made news in the UK. If they are excited by the order placed for a single component??? Also from the UK, the construction industry is looking at their piece of the pie: Gearing up for the £30 billion nuclear boom. Here in the US it is a similar story. In Tennesse last week the ramp up of construction for the Watts Bar nuclear plant made news in itself. That plant already has a Westinghouse reactor and when it opens it will be the first nuclear reactor to open in the US since 1996.


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Actually, back to real estate and how the fear out there has everyone's logic all convoluted on what declining sales mean for the region. The confusion of supply vs. demand among even the professionals is everywhere. So as much as I mike quibble with the media stories, they are just duly reporting what the experts are telling you even if it is all a bit backwards. Lest I confuse you more, Seeking Alpha explains the confusion out there and in the media reporting on real estate markets better than my rambling. See:

Home Price Plunge Produces Sales Spikes In Many Cities

They actually mention one local Pittsburgh story in their list of examples.

4 Comments:

Anonymous Anonymous said...

Off topic, but how about the confusion over Pittsburgh's diversity? From the middle of the PG's Monday top story on regional indicators:

"The report ... offered some sobering food for thought (a city built on its ethnic diversity is now one of the least diverse among its peers)."

And then the last paragraph, quoting one of the report's alleged authors:

"... Mr. Miller said, "I think we have a truly diverse, multicultural, world-class population that has a great breadth of appreciation for a full range of entertainment opportunities.""

Tuesday, November 25, 2008 2:59:00 PM  
Blogger C. Briem said...

Recognizing that everything is connected somehow, I still try not to comment too much on things I am so directly involved in and I suppose I would be counted in there as an 'alleged' author as well.. Not quite sure the 'alleged' part? It didn't write itself. :-)

in that the sentence quoted is Harold's I would leave it to him to comment specifically.. not that I expect him to be reading here. He does have his own blog and you could direct that to him over there if you want... but if I were to guess it's just the way the quote came out and have been caught in half-quote often enough myself. No doubt Harold knows the lay of the land on the diversity front.

No doubt though.. lack of folks moving in for decades have left us with a lack of diverstiy on many fronts. You kind of need to write a tome just to get into what 'diversity' is in the first place. I once was quoted explaining a factoid that in one metric we are the "whiteist" metro in the nation which folks do not realize. I didnt come up with that factoid by the way. But when I got quoted repeating it in some story, I began to notice it being spread around by lots of sites that lets just say are not diverstiy-friendly.

Tuesday, November 25, 2008 10:11:00 PM  
Anonymous Anonymous said...

You're probably right. Out-of- context, messed-up quote. HM was probably just referring to the subset of the Pittsburgh population that attends arts and cultural events. While that crew is probably diverse and multicultural compared to the Pittsburgh region as a whole, it is likely also the whitest "haired" demographic in the metro area.

As far as the "alleged authorship" goes, I just meant that HM probably didn't put fingers to keyboard to get the report down on paper. You actually did all the work, right?

Wednesday, November 26, 2008 9:52:00 AM  
Anonymous Anonymous said...

Harold's answer, from his blog's comments:

"Harold D. Miller said...

In that context, "diverse" meant diversity of interest, not of race or ethnicity."

Wednesday, November 26, 2008 12:31:00 PM  

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