from warren 'the richest man in the world' buffet. hot off the presses...
Warren Buffett, the world's richest person, said on Monday the U.S. economy is in a recession that will be more severe than most people expect.
Buffett made his comments on CNBC television after his Berkshire Hathaway Inc (BRKa.N) (BRKb.N) agreed to invest $6.5 billion in the takeover of chewing gum maker Wm Wrigley Jr Co (WWY.N) by Mars Inc in a $23 billion transaction.
"This is not a field of specialty for me, but my general feeling is that the recession will be longer and deeper than most people think," Buffett said. "This will not be short and shallow.
"I think consumers are feeling gas and food prices," he added, "and not feeling they've got a lot of money for other things."
so, is anyone feeling the pain right now? it's kind of hard for me, personally, to say. feels pretty much the same as the past year or so. work in a steady flow - not huge, but steady. of course, we got out of the home markets last year.
my take is that the oil boom is feeding so much work in the middle east that if that dries up, there would be some very severe pain here in the architectural community. i know one of the largest firms here has a huge chunk of their current workload abroad. if that goes, they could lose 30% or more of their workforce.
the oil boom collapsing is why Dubai is building so much...they know that they need to have something other than oil (international business and tourism) to sustain themsleves
laru - We're slow as molasses at work. Many people have been sitting around since the first of the year with little or nothing to do. I am one of the fortunate ones... I've actually had a project to work on since the beginning of the year. They've already laid off six people and unless one of our major client starts back up with their normal projects within the next two weeks, I foresee more looming on the horizon. I'd be lying if I said I wasn't worried about my future. Rising gas prices wouldn't be so bad if the price of groceries weren't going up as well. I got a raise at the beginning of the year but you wouldn't know it. A friend of mine got laid off at another architectural/engineering firm in the city just two weeks ago b/c they were slow. He went for an interview last week, which was looking very promising. Unfortunately the day beforethough, the company put a hiring freeze into effect. Talking to others out there (not just in our industry) it's pretty slow here. No one is really hiring and layoffs are beginning to sprout up.
slow as shit here. office of 6, only one small project to work on. All the other large projects, which are all actually out of the country are 'paused' for now - the recession if not global has surely put everyone in a state of shock.
I would be lying if i said i was not concerned. At this rate, I would rather take a pay cut than see people being laid off.
Things seem to be pretty comfy in NYC right now, its almost like manhattan real estate (and the people that buy it) seem largely immune to this. Both my old job and my new job have had no shortage of work. For once i'm thankful to be in NY, sure its expensive but at least i'm getting a paycheck.
I think it is true that firms with an international focus will be much better equipped to weather the next year or so, especially if they are in Dubai. Even if there is a worldwide recession, there is a thirst for oil that doesn't seem like letting up anytime soon. It doesn;t seem like there are many people in the architecture field who are really shrewd about predicting the future and setting realistic goals, i.e., when the times are good we just keep ramping up and when they are bad we have to make drastic reductions. Architecture needs to be more diverse, not because making money is a goal, but to increase our power and leverage, to find sure footing. I wish I knew how
i've been trying to find a job in seattle for two months. everyone is telling me that i have great work, but that they don't have the work/aren't getting paid, and no else they know is hiring, and (the best part) they feel 'sorry for everyone who is graduating'. my husband is a structural engineer and he can't find a job either.
Because the building industry is so susceptable to economic shifts, changes in the prices for building materials, changes in interest rates, energy costs like oil, the housing market and speculation, the mood of the market (with all of its jitters), the investment climate (which determines how liquid assets are for banks or any client that wants to build something), our profession seems to be one of the first to get hit by economic shit hitting the fan... Is a big recession coming? Or is it blown out of proportion?
It seems like alot of the problems that our economy is facing right now facing are sort of a *result* of our industry as much as they impact it... Historically, economic recessions typically have followed crashes in the mortgage market which lead to declines in the housing market... which lead to people losing their homes, or their equity, declines in other financial markets, and a loss in consumer confidence... One factor is basically a problem that alot of the value created in the building industry is a false value. The illusion of value created by speculators in the housing market... Foreign investors that buy up dozens of condos in a city and leave them essentially empty to watch their value rise, and you have a whole market of empty propreties, and then financial markets which invent "creative ways" to finance and encourage these kinds of purchases by offering shakey loan products. The problem is then that these products are eaten up by real working people who should never have been sold them, and then they lose their homes, the savings that they had invested in them, and everything takes a downward spiral: banks are suffering, there is a backlash, consumer spending takes a nose dive because of a loss of consumer confidence, part because people really cannot afford to spend anymore (if they have lost their homes and given the rising costs), and because of the jitters in financial markets that make people hold onto their money...
What's the strategy for riding it out in this industry? Position yourself more globally? Diversify in the markets you have a foothold on? How does the strategy differ for a large firm vs. a small firm? What about from one market to the next? Housing vs. commercial vs. hospitality vs. retail vs. health care vs. institutional?
The other thing is, government policy during recessions tend to try all different things to stimulate the economy... This also happens to be an election year... What works, and how might a shift in government spending or monetary policy help our industry? Interest rate cuts? Increased spending on infrastructure? Incentives to create jobs, stimulus packages? How does a government help restore consumer confidence and the housing market? Is just a change in government, a change in foreign and domestic policy already a positive economic force, given that so much of our economy is dependent on foreign investment and consumer optimism, and the productivity and competitiveness of our labor force globally?
Also, where is the market headed? Is there some next big trend or emerging market that architects could jump on to ride out an economic downturn? For example, condos turn to rentals... Companies that might want to build large new buildings might turn to renovating their existing office spaces? Could it be a shift from large buildings to a major wave of T.I. work, quicker turnaround projects requiring agile project teams, and aggressive job acquisition?
What is it about construction and building costs that will affect the availability of work? Is it construction and energy costs? The costs of capital? What about labor costs? Is there a particular kind of work (for example, more labor intensive rather than material intensive) that might fair better if we get hit by a serious economic downturn? Things like restoring or rehabitating older buildings for energy efficiency? Are we going to see a wave of energy efficient strategies and an increase in demand for energy efficient building in response to skyrocketing energy costs? How about: solar, natural ventilation and lighting, and wind power renovations to existing buildings?
Here in the higher end residential remodel area we are staying fairly busy. A friend of mine theorized that most people are feeling like they can't sell their home,so they might as well make improvements to it since they will be in it for awhile. I don't know what is driving my client's thinking, but I hope it stays this way.
Sadly we live so close to my income level* that we have little savings - I'm one of those many, many Americans who is in peril if I miss a single paycheck eek! So the "economic stimulus check" is going right into the savings account.
*When my son starts at a public school in September I will suddenly have $700 additional dollars a month wahoo! And it too will (hopefully) go into savings...
lb-
i look forward to having kids, but it's really nice being able to take 1/2 salary for expenditures (rent, bills, food, etc) and taking the other half and splitting btwn stocks, roth, orange and educational expenses*
*=architecture travels
also, we've not really noticed a slowdown, but we're not as vested in the residential market. if anything, locally contractors are getting really hungry and being more competitive, so no more outrageous bids (yay).
it appears it's not just a housing correction, but the slowdown is correcting the cost of construction as well. the variable being, will the cost of fuel pretty much negate those corrections?
But to be serious, forecasts suggest that Seattle may fare okay in an upcoming economic downturn... The housing market here in Seattle, next to manhattan they say has been one of the country's most stable, and there is sufficient job growth and a steady influx of people here... Housing prices, while they've come down a little bit, and alot of condo devlopments are turning to rentals, haven't dropped too much yet... Although it's hard to tell what will happen... Rents are going up and it's becoming tougher to get approval on loans... Housing sales also seem to have ground to a halt after the hot market the last couple years, and people aren't able to sell... I've talked to people whose homes have almost doubled in value over the last few years only to be unable to sell now... But some of the larger international companies are expanding here, so hopefully there should be sufficient growth in the IT and bio-technology job markets, the optimists say that there may be a next wave of IT boom here... Google, yahoo, and microsoft are expanding their presence here heavily in the coming year, which should create jobs...
Also, they say port cities that benefit from trade, if hit, will get hit less hard... So it seems like Seattle might be a bit more insulated than some of the interior cities... So far, my office has had plenty of work, it's been a record year... Although even just at a glance, a few projects have been put on hold in part due to the shifts in the financial markets... One university building project which depended heavily on donors lost its ability to raise funds due to the investment climate and has been put on hold... At least a couple other significant projects also put on hold but I think to a lesser degree, they are doing some value engineering and also to re-assess the economic situation I think... I'm not sure, I think the clients may have gotten a bit spooked by economic jitters...
-we just refi'd our house and were able to cash out $25k and keep our payments just above where they were.
-we're about to undertake some fairly expensive renovation work, but we've had an interesting time FINDING CONTRACTORS who aren't too busy to do the work.
-my office is getting some of the biggest projects of its history and is struggling to change the internal culture, allowing ourselves to say 'no' to some projects so that we're not flooded. we're too busy and there doesn't appear to be a big pool of people from which to hire, either.
so, with all that said, i'm both confused and scared by the talk of recession. things look sunny here but the unavoidable doom and gloom discussions and, frankly, the CONSTANT REPORTING in the media about how bad things are gonna be are tending to make this particular consumer a little scared and much more skittish when it comes to spending/investing/saving.
is recession a social construct, a downward spiral caused by TALK of recession that feeds upon itself?
One thing that will happen due to a decrease in the US dollar and an increase in energy prices is a shift away from labour intensive work in far off countries.
Why?
A lower US dollar makes US labour more cost competitive with respect to foreign currencies which are now much higher, ie. foreign labour is more expensive.
Higher energy prices make shipping more expensive so it's easier to find closer sources of manufacturing
The end result?
The US will see manufacturing jobs returning, we're already seeing mfg jobs here in Canada going south to the US.
Less new product will be shipped from overseas into the US (because it's now more expensive), leading to an increase in reusing materials (and buildings)
The end result for architects?
Brush up on your mfg plant architecture, and (as other posters have said) on your reuse and recyling of architecture.
Proposed by several economists over the decades: Start to build the tallest building in the world, prepare for imminent economic collapse.
1930/31: Chrysler Building & Empire State Building. Both completed just at the start of the great depression
1974: World Trade Centre, Sears, Hancock. Both completed in the stagflation of the 1970's
[local example: Canary Wharf, London, 1991 - UK recession]
1997: Petronas Towers: East Asian Financial Crisis
2008: Burj Dubai: Right now
The theory goes that in times of low inflation and high money supply investors look for big debt-leveraged investments (skyscrapers). Building the biggest of these is always an indicator that money supply is too easy, indicative of the pinnacle of an economic cycle. As project nears completion interest rates rise and financial service/insurance/real estate companies that would have inhabited the skyscraper are noticing a downturn. The buildings remain un-let while debt servicing becomes more onerous.
The Burj can also be the result of a lot of oil money being used by a state that knows it's running out fast and wants to diversify its economy and market itself better.
I'm not sure I buy the argument that the low US dollar will be good for the economy. Yes, some jobs will be in-sourced, but the low dollar also causes inflation. Our stupid fed reserve chairman was asked about this and gave some idiotic response that it only affects Americans if they travel abroad. Hello, since when are any consumer items in the USA made in the USA?!?! The low dollar makes everything on the shelves of Wal-Mart more expensive...not just BMW's and French Champagne.
Right now I'm very worried. Not so much for a recession. That I can deal with as it's just a correction from the housing bubble and previous stock bubble. What worries me is that gov't will try to "fix" the economy and cause more damage than good. The mortgage bail-out is a perfect example.
Right now I'm busy, but my clients aren't recession proof. I've been focusing more on saving in case there are bumps in the road. I do see some regions withstanding high energy prices and a prolonged recession better than others. We have contigency plans in place for potential moves if need be.
America needs to become a producer nation again and dam the rest of the world. Our forign policy has been ship them our jobs and production in exchange for peace. A good dose of isolationism will do us good and remind other regions of our stabilizing influence.
aquapura,
A similar incident occured in the early 90s, said incident involved a recession in NorthAm and a huge collapse in Japan.
Prior to the collapse, Japan was seen as the next great superpower, everybody invested in Japan, a huge proportion of Japan's savings were in American currency due to the massive profits reaped from exports to the US and from US investment in Japan. The fear was the Japan would take all US mfg jobs etc. etc.
Then the dollar weakened, US firms pulled out of Japan b/c it wasn't cost competitive anymore and next thing you know Japan's reserves of US currency are severely weakened, as was it's (mostly US funded) real estate sector. The US had a bit of a setback, Japan is still just barely making it out.
Something similar is occuring right now, China and India have taken significant leaps in their competitiveness, enough to scare the rest of the world. They also both hold huge sums of US currency, China has trillions of US dollars, that country has lost significantly due to the weak US dollar. I think India is more insulated due to the diversified economy they've developed not to mention the fact that they have taken on work that essentially has very little energy costs associated with it (computer programming etc etc)
Also a weakening US dollar also makes the massive debt load that the US is carrying more manageable, basically the money it has borrowed is now worth less than when the US dollar was high and the initial loan was made.
Basically a recession HAS to occur in order for the US and North Am (and to some extent Europe) to experience a bull market in the near future. If no recession had occured the US would be screwed.
Jack K,
Isolationist policies have proven to be a bad idea in the past, take the example of the USSR and USA (prior to WW2). You do NOT want the US to become isolationist, you WILL be eating corn and soy all frickin day long if this happens b/c the US does not have the ability to produce other food in large enough quantities (at least not in quantities that the average person can afford).
ff33,
This recession will hurt China more than us, but I'm sure that alot of work will stay in China.
reclaiming production(in a new sustainable way) is key, that takes organized people, currently people are divided by the media too much to even think for them selfs in many cases.
zigfromsa-
I don't quite follow your comparison of the Japanese Asset Bubble to what's going on today. You kinda run several things together there.
I agree that a recession MUST occur to save the US economy. Recessions are a good thing. They are corrections that bring normalcy back to the economy. Problem is that politicians hate them and will do anything to keep the status quo.
As for your Japan comparison, I have heard arguments that the deflation of the dollar is a way to "eliminate" the national debt. Also heard about how the US housing bubble mimics the Japanese one. They all have subtile links but nothing that can be summed up easily.
I love Chicago!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! growing up in the 'Nati, I would go to Chicago all the time. That is where I decided I wanted to be an architect. I hate Chicago!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
aqua,
from what I understand, the Japanese bubble was propped up by heavy US investment as a way for US investors to hedge risk, however this made the health of the Japanese economy reliant on the health of the US economy. It also served as a way for the US to control Japanese growth by investing or not investing in the Japanese economy depending on how well the US economy was doing, which led to the Japanese holding a massive account surplus of US currency.
With the US recession in 90/91, US investors pulled out of Japanese investments (specifically the overheated Japanese real estate market), this sent the Japanese market crashing. The crash was exacerbated by the huge US currency surplus that Japan had at that time, the surplus lost a lot of value b/c the dollar lost a lot of value.
We have recently been awarded several large projects abroad. With 80% of our workload being international. We are still seeing a strong demand in the hospitality sectors (with projects in Japan/Pacific Rim, as well as caribbean). And some very promissing work in Central and South America. Most projects being financed/built by europeans (Mostly Spanish). Brazil is also showing great signs of expansion. There is huge ammounts of infrastructure work going on, and with the decentralization of cities such as Sao Paulo, there will be work for years to come.
Many local Miami firms which saw rapid expansion and growth during the "condo boom" are feeling serious pain...and lay-offs.
In response to mdler's comment: "in cities where the infastructure is %99.9 oriented to the car, people are fucked"...yes. Miami being one of those dreaded "fucked" cities...we have been seeing some interesting shifts in employee commuting. Over half of our employees have a 1hour commute to work each morning (because it's much cheaper to live in the burbs...specially if you have kids)
Many have traded their "buildings" as one lady called her ford excursion, to civics, corollas, etc. We also have 5-6 people who are now using the bus from Miami beach to downtown and then the metrorail to the office. There are others considering moving back into the city, by taking advantage of the "condo bust" which is one of the worst in history (Miami ranks in the top 3 in the nation for housing problems (foreclosures/price declines))
I wonder if you think transportation infrastructure will ever really improve in LA?..and to stay on topic, how this will directly help the economy?... or not?
I dont think that it will...LA really doesnt have a strong leadership that is looking out for the well being of the city as a whole (everyone is in in for themselves).
When the light rail line was proposed to go to the airport, for example, the people who own the parking lots near the airport lobbied against the rail line...which is why it doesnt go to the airport.
LA zoning code is still set up for low density development...there really is very little support from the top for smart, dense development
..makes you wonder how bad things have to get before an Urban progress is capable again. ..its funny to think about those parking lot owners having empty lots when no one can afford to drive there anymore.
let's talk about the economy...
from warren 'the richest man in the world' buffet. hot off the presses...
Warren Buffett, the world's richest person, said on Monday the U.S. economy is in a recession that will be more severe than most people expect.
Buffett made his comments on CNBC television after his Berkshire Hathaway Inc (BRKa.N) (BRKb.N) agreed to invest $6.5 billion in the takeover of chewing gum maker Wm Wrigley Jr Co (WWY.N) by Mars Inc in a $23 billion transaction.
"This is not a field of specialty for me, but my general feeling is that the recession will be longer and deeper than most people think," Buffett said. "This will not be short and shallow.
"I think consumers are feeling gas and food prices," he added, "and not feeling they've got a lot of money for other things."
so, is anyone feeling the pain right now? it's kind of hard for me, personally, to say. feels pretty much the same as the past year or so. work in a steady flow - not huge, but steady. of course, we got out of the home markets last year.
my take is that the oil boom is feeding so much work in the middle east that if that dries up, there would be some very severe pain here in the architectural community. i know one of the largest firms here has a huge chunk of their current workload abroad. if that goes, they could lose 30% or more of their workforce.
i just recieved a 20% pay cut today...seeing how gas is $5 a gallon I am fucked if I stay in LA...
laru
the oil boom collapsing is why Dubai is building so much...they know that they need to have something other than oil (international business and tourism) to sustain themsleves
laru - We're slow as molasses at work. Many people have been sitting around since the first of the year with little or nothing to do. I am one of the fortunate ones... I've actually had a project to work on since the beginning of the year. They've already laid off six people and unless one of our major client starts back up with their normal projects within the next two weeks, I foresee more looming on the horizon. I'd be lying if I said I wasn't worried about my future. Rising gas prices wouldn't be so bad if the price of groceries weren't going up as well. I got a raise at the beginning of the year but you wouldn't know it. A friend of mine got laid off at another architectural/engineering firm in the city just two weeks ago b/c they were slow. He went for an interview last week, which was looking very promising. Unfortunately the day beforethough, the company put a hiring freeze into effect. Talking to others out there (not just in our industry) it's pretty slow here. No one is really hiring and layoffs are beginning to sprout up.
mdler - are you serious? Did you realy receive a cut in pay? That sucks. Much empathy to you.
slow as shit here. office of 6, only one small project to work on. All the other large projects, which are all actually out of the country are 'paused' for now - the recession if not global has surely put everyone in a state of shock.
I would be lying if i said i was not concerned. At this rate, I would rather take a pay cut than see people being laid off.
Things seem to be pretty comfy in NYC right now, its almost like manhattan real estate (and the people that buy it) seem largely immune to this. Both my old job and my new job have had no shortage of work. For once i'm thankful to be in NY, sure its expensive but at least i'm getting a paycheck.
Let's not.?
I trust what Warren says more than the Federal officials at the moment.
He has made good money watching and learning.
Plus, he is old.
I think it is true that firms with an international focus will be much better equipped to weather the next year or so, especially if they are in Dubai. Even if there is a worldwide recession, there is a thirst for oil that doesn't seem like letting up anytime soon. It doesn;t seem like there are many people in the architecture field who are really shrewd about predicting the future and setting realistic goals, i.e., when the times are good we just keep ramping up and when they are bad we have to make drastic reductions. Architecture needs to be more diverse, not because making money is a goal, but to increase our power and leverage, to find sure footing. I wish I knew how
i've been trying to find a job in seattle for two months. everyone is telling me that i have great work, but that they don't have the work/aren't getting paid, and no else they know is hiring, and (the best part) they feel 'sorry for everyone who is graduating'. my husband is a structural engineer and he can't find a job either.
this is not looking good, not by a long shot.
we have lots of work
Because the building industry is so susceptable to economic shifts, changes in the prices for building materials, changes in interest rates, energy costs like oil, the housing market and speculation, the mood of the market (with all of its jitters), the investment climate (which determines how liquid assets are for banks or any client that wants to build something), our profession seems to be one of the first to get hit by economic shit hitting the fan... Is a big recession coming? Or is it blown out of proportion?
It seems like alot of the problems that our economy is facing right now facing are sort of a *result* of our industry as much as they impact it... Historically, economic recessions typically have followed crashes in the mortgage market which lead to declines in the housing market... which lead to people losing their homes, or their equity, declines in other financial markets, and a loss in consumer confidence... One factor is basically a problem that alot of the value created in the building industry is a false value. The illusion of value created by speculators in the housing market... Foreign investors that buy up dozens of condos in a city and leave them essentially empty to watch their value rise, and you have a whole market of empty propreties, and then financial markets which invent "creative ways" to finance and encourage these kinds of purchases by offering shakey loan products. The problem is then that these products are eaten up by real working people who should never have been sold them, and then they lose their homes, the savings that they had invested in them, and everything takes a downward spiral: banks are suffering, there is a backlash, consumer spending takes a nose dive because of a loss of consumer confidence, part because people really cannot afford to spend anymore (if they have lost their homes and given the rising costs), and because of the jitters in financial markets that make people hold onto their money...
What's the strategy for riding it out in this industry? Position yourself more globally? Diversify in the markets you have a foothold on? How does the strategy differ for a large firm vs. a small firm? What about from one market to the next? Housing vs. commercial vs. hospitality vs. retail vs. health care vs. institutional?
The other thing is, government policy during recessions tend to try all different things to stimulate the economy... This also happens to be an election year... What works, and how might a shift in government spending or monetary policy help our industry? Interest rate cuts? Increased spending on infrastructure? Incentives to create jobs, stimulus packages? How does a government help restore consumer confidence and the housing market? Is just a change in government, a change in foreign and domestic policy already a positive economic force, given that so much of our economy is dependent on foreign investment and consumer optimism, and the productivity and competitiveness of our labor force globally?
Also, where is the market headed? Is there some next big trend or emerging market that architects could jump on to ride out an economic downturn? For example, condos turn to rentals... Companies that might want to build large new buildings might turn to renovating their existing office spaces? Could it be a shift from large buildings to a major wave of T.I. work, quicker turnaround projects requiring agile project teams, and aggressive job acquisition?
What is it about construction and building costs that will affect the availability of work? Is it construction and energy costs? The costs of capital? What about labor costs? Is there a particular kind of work (for example, more labor intensive rather than material intensive) that might fair better if we get hit by a serious economic downturn? Things like restoring or rehabitating older buildings for energy efficiency? Are we going to see a wave of energy efficient strategies and an increase in demand for energy efficient building in response to skyrocketing energy costs? How about: solar, natural ventilation and lighting, and wind power renovations to existing buildings?
wb-
ZDS might be hiring
also, recent adverts for john traver, bassetti, nbbj, form + function and sullivan conard.
of those, nbbj might be the best option.
also, check out johnston architects (new office on northlake) they do some decent work.
Peter Cohan
floisand studio
prentiss
stuart silk
jill lewis
and to continue from another thread, anderson + anderson has an office that might be worth checking out.
can't help you on the engineers, though i've worked w/ following:
KPFF
SSF
coughlin porter lundeen
peter opsahl
Here in the higher end residential remodel area we are staying fairly busy. A friend of mine theorized that most people are feeling like they can't sell their home,so they might as well make improvements to it since they will be in it for awhile. I don't know what is driving my client's thinking, but I hope it stays this way.
Sadly we live so close to my income level* that we have little savings - I'm one of those many, many Americans who is in peril if I miss a single paycheck eek! So the "economic stimulus check" is going right into the savings account.
*When my son starts at a public school in September I will suddenly have $700 additional dollars a month wahoo! And it too will (hopefully) go into savings...
thanks holz...
move to Vancouver.. we are bubbling with work here
wrecking ball- regarding job hunting, sorry to hear you're finding it tough in seattle...
structural, try magnussen klemencic associates (mka)...
architecture, try in addition to the firms holz box listed... mithun, mahlum, LMN, olson sundberg, miller hull, weinstein, bohlin cywinski jackson, zimmer gunsul fraska (ZGF), gensler... callison, i know they are hiring right now... GGLO... SKB, smaller firms... coop 15, place, vanderventer + carlander, Pb elemental, PIQUE, eric cobb, suyama peterson deguchi, eggleston farkas, bjarko serra, cutler anderson... david coleman... EDGE... Environmental works... other big ones that may be hiring: mulvanny G2... weber + thompson... DLR...
wb - not a prob. good luck w/ search.
lb-
i look forward to having kids, but it's really nice being able to take 1/2 salary for expenditures (rent, bills, food, etc) and taking the other half and splitting btwn stocks, roth, orange and educational expenses*
*=architecture travels
also, we've not really noticed a slowdown, but we're not as vested in the residential market. if anything, locally contractors are getting really hungry and being more competitive, so no more outrageous bids (yay).
it appears it's not just a housing correction, but the slowdown is correcting the cost of construction as well. the variable being, will the cost of fuel pretty much negate those corrections?
take a job w/ home depot before callison, mulvanny or weber thompson.
or driscoll. god, every time i turn around, there's a design review for another fugly driscoll project. i just don't get it.
holz, hey it's work ain't it?
if it really is a recession, rather be *rolling out* costcos at mulvanny, than *working* at costo...
Which brings up a good point, to get back to the economy discussion...
In times of recession: do COSTCOs... People will need their COSTCOs...
im glad that this has turned into the 'find mdler a job in Seattle because LA is too damn expensive' thread ;)
But to be serious, forecasts suggest that Seattle may fare okay in an upcoming economic downturn... The housing market here in Seattle, next to manhattan they say has been one of the country's most stable, and there is sufficient job growth and a steady influx of people here... Housing prices, while they've come down a little bit, and alot of condo devlopments are turning to rentals, haven't dropped too much yet... Although it's hard to tell what will happen... Rents are going up and it's becoming tougher to get approval on loans... Housing sales also seem to have ground to a halt after the hot market the last couple years, and people aren't able to sell... I've talked to people whose homes have almost doubled in value over the last few years only to be unable to sell now... But some of the larger international companies are expanding here, so hopefully there should be sufficient growth in the IT and bio-technology job markets, the optimists say that there may be a next wave of IT boom here... Google, yahoo, and microsoft are expanding their presence here heavily in the coming year, which should create jobs...
Also, they say port cities that benefit from trade, if hit, will get hit less hard... So it seems like Seattle might be a bit more insulated than some of the interior cities... So far, my office has had plenty of work, it's been a record year... Although even just at a glance, a few projects have been put on hold in part due to the shifts in the financial markets... One university building project which depended heavily on donors lost its ability to raise funds due to the investment climate and has been put on hold... At least a couple other significant projects also put on hold but I think to a lesser degree, they are doing some value engineering and also to re-assess the economic situation I think... I'm not sure, I think the clients may have gotten a bit spooked by economic jitters...
How are things elsewhere in the country?
mdler, welcome to seattle! the air here is also nicer... although you came just in time for us to lose our NBA team... ;)
-we just refi'd our house and were able to cash out $25k and keep our payments just above where they were.
-we're about to undertake some fairly expensive renovation work, but we've had an interesting time FINDING CONTRACTORS who aren't too busy to do the work.
-my office is getting some of the biggest projects of its history and is struggling to change the internal culture, allowing ourselves to say 'no' to some projects so that we're not flooded. we're too busy and there doesn't appear to be a big pool of people from which to hire, either.
so, with all that said, i'm both confused and scared by the talk of recession. things look sunny here but the unavoidable doom and gloom discussions and, frankly, the CONSTANT REPORTING in the media about how bad things are gonna be are tending to make this particular consumer a little scared and much more skittish when it comes to spending/investing/saving.
is recession a social construct, a downward spiral caused by TALK of recession that feeds upon itself?
One thing that will happen due to a decrease in the US dollar and an increase in energy prices is a shift away from labour intensive work in far off countries.
Why?
A lower US dollar makes US labour more cost competitive with respect to foreign currencies which are now much higher, ie. foreign labour is more expensive.
Higher energy prices make shipping more expensive so it's easier to find closer sources of manufacturing
The end result?
The US will see manufacturing jobs returning, we're already seeing mfg jobs here in Canada going south to the US.
Less new product will be shipped from overseas into the US (because it's now more expensive), leading to an increase in reusing materials (and buildings)
The end result for architects?
Brush up on your mfg plant architecture, and (as other posters have said) on your reuse and recyling of architecture.
my firm is swamped with work and is hiring. a lot of firms in my town seem to be hiring too.
The Skyscraper Index.
Proposed by several economists over the decades: Start to build the tallest building in the world, prepare for imminent economic collapse.
1930/31: Chrysler Building & Empire State Building. Both completed just at the start of the great depression
1974: World Trade Centre, Sears, Hancock. Both completed in the stagflation of the 1970's
[local example: Canary Wharf, London, 1991 - UK recession]
1997: Petronas Towers: East Asian Financial Crisis
2008: Burj Dubai: Right now
The theory goes that in times of low inflation and high money supply investors look for big debt-leveraged investments (skyscrapers). Building the biggest of these is always an indicator that money supply is too easy, indicative of the pinnacle of an economic cycle. As project nears completion interest rates rise and financial service/insurance/real estate companies that would have inhabited the skyscraper are noticing a downturn. The buildings remain un-let while debt servicing becomes more onerous.
Prepare for the worst.
what happens when a $45.5 trillion bursts?
The Burj can also be the result of a lot of oil money being used by a state that knows it's running out fast and wants to diversify its economy and market itself better.
I'm not sure I buy the argument that the low US dollar will be good for the economy. Yes, some jobs will be in-sourced, but the low dollar also causes inflation. Our stupid fed reserve chairman was asked about this and gave some idiotic response that it only affects Americans if they travel abroad. Hello, since when are any consumer items in the USA made in the USA?!?! The low dollar makes everything on the shelves of Wal-Mart more expensive...not just BMW's and French Champagne.
Right now I'm very worried. Not so much for a recession. That I can deal with as it's just a correction from the housing bubble and previous stock bubble. What worries me is that gov't will try to "fix" the economy and cause more damage than good. The mortgage bail-out is a perfect example.
Right now I'm busy, but my clients aren't recession proof. I've been focusing more on saving in case there are bumps in the road. I do see some regions withstanding high energy prices and a prolonged recession better than others. We have contigency plans in place for potential moves if need be.
America needs to become a producer nation again and dam the rest of the world. Our forign policy has been ship them our jobs and production in exchange for peace. A good dose of isolationism will do us good and remind other regions of our stabilizing influence.
soon, perhaps China will be outsourcing to us.
aquapura,
A similar incident occured in the early 90s, said incident involved a recession in NorthAm and a huge collapse in Japan.
Prior to the collapse, Japan was seen as the next great superpower, everybody invested in Japan, a huge proportion of Japan's savings were in American currency due to the massive profits reaped from exports to the US and from US investment in Japan. The fear was the Japan would take all US mfg jobs etc. etc.
Then the dollar weakened, US firms pulled out of Japan b/c it wasn't cost competitive anymore and next thing you know Japan's reserves of US currency are severely weakened, as was it's (mostly US funded) real estate sector. The US had a bit of a setback, Japan is still just barely making it out.
Something similar is occuring right now, China and India have taken significant leaps in their competitiveness, enough to scare the rest of the world. They also both hold huge sums of US currency, China has trillions of US dollars, that country has lost significantly due to the weak US dollar. I think India is more insulated due to the diversified economy they've developed not to mention the fact that they have taken on work that essentially has very little energy costs associated with it (computer programming etc etc)
Also a weakening US dollar also makes the massive debt load that the US is carrying more manageable, basically the money it has borrowed is now worth less than when the US dollar was high and the initial loan was made.
Basically a recession HAS to occur in order for the US and North Am (and to some extent Europe) to experience a bull market in the near future. If no recession had occured the US would be screwed.
Jack K,
Isolationist policies have proven to be a bad idea in the past, take the example of the USSR and USA (prior to WW2). You do NOT want the US to become isolationist, you WILL be eating corn and soy all frickin day long if this happens b/c the US does not have the ability to produce other food in large enough quantities (at least not in quantities that the average person can afford).
ff33,
This recession will hurt China more than us, but I'm sure that alot of work will stay in China.
reclaiming production(in a new sustainable way) is key, that takes organized people, currently people are divided by the media too much to even think for them selfs in many cases.
all I know is that sitting in LA traffic @ $5 a gallon aint good...in cities where the infastructure is %99.9 oriented to the car, people are fucked.
I wanna walk
brink,
Im not in Seattle just yet...get me a job and I'll buy you a beer!
mdler, Chitown would love to have you. You can walk or take a train ( despite the rantings on this page) anywhere. The only downside - Feburary.
zigfromsa-
I don't quite follow your comparison of the Japanese Asset Bubble to what's going on today. You kinda run several things together there.
I agree that a recession MUST occur to save the US economy. Recessions are a good thing. They are corrections that bring normalcy back to the economy. Problem is that politicians hate them and will do anything to keep the status quo.
As for your Japan comparison, I have heard arguments that the deflation of the dollar is a way to "eliminate" the national debt. Also heard about how the US housing bubble mimics the Japanese one. They all have subtile links but nothing that can be summed up easily.
Jack
I love Chicago!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! growing up in the 'Nati, I would go to Chicago all the time. That is where I decided I wanted to be an architect. I hate Chicago!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
k that was funny
aqua,
from what I understand, the Japanese bubble was propped up by heavy US investment as a way for US investors to hedge risk, however this made the health of the Japanese economy reliant on the health of the US economy. It also served as a way for the US to control Japanese growth by investing or not investing in the Japanese economy depending on how well the US economy was doing, which led to the Japanese holding a massive account surplus of US currency.
With the US recession in 90/91, US investors pulled out of Japanese investments (specifically the overheated Japanese real estate market), this sent the Japanese market crashing. The crash was exacerbated by the huge US currency surplus that Japan had at that time, the surplus lost a lot of value b/c the dollar lost a lot of value.
I wrote about the slowing of work in our office many months ago..."general market slowdown" - http://www.archinect.com/forum/threads.php?id=69537_0_42_0_C
We have recently been awarded several large projects abroad. With 80% of our workload being international. We are still seeing a strong demand in the hospitality sectors (with projects in Japan/Pacific Rim, as well as caribbean). And some very promissing work in Central and South America. Most projects being financed/built by europeans (Mostly Spanish). Brazil is also showing great signs of expansion. There is huge ammounts of infrastructure work going on, and with the decentralization of cities such as Sao Paulo, there will be work for years to come.
Many local Miami firms which saw rapid expansion and growth during the "condo boom" are feeling serious pain...and lay-offs.
In response to mdler's comment: "in cities where the infastructure is %99.9 oriented to the car, people are fucked"...yes. Miami being one of those dreaded "fucked" cities...we have been seeing some interesting shifts in employee commuting. Over half of our employees have a 1hour commute to work each morning (because it's much cheaper to live in the burbs...specially if you have kids)
Many have traded their "buildings" as one lady called her ford excursion, to civics, corollas, etc. We also have 5-6 people who are now using the bus from Miami beach to downtown and then the metrorail to the office. There are others considering moving back into the city, by taking advantage of the "condo bust" which is one of the worst in history (Miami ranks in the top 3 in the nation for housing problems (foreclosures/price declines))
fascinating thread...
for you LA folks,
I wonder if you think transportation infrastructure will ever really improve in LA?..and to stay on topic, how this will directly help the economy?... or not?
Light Rails?
ff33
I dont think that it will...LA really doesnt have a strong leadership that is looking out for the well being of the city as a whole (everyone is in in for themselves).
When the light rail line was proposed to go to the airport, for example, the people who own the parking lots near the airport lobbied against the rail line...which is why it doesnt go to the airport.
LA zoning code is still set up for low density development...there really is very little support from the top for smart, dense development
mdler, you will find very similar frustrations up here.
Sounds familar, - zoning lockdown...
..makes you wonder how bad things have to get before an Urban progress is capable again. ..its funny to think about those parking lot owners having empty lots when no one can afford to drive there anymore.
the less cars are driven then the more they are parked...i'm bullish on parking lots right now
holz.box
at least I can walk (fingers are crossed)
walking is so hard, got a skate?
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