By Seth Sandronsky
U.S. economic growth rose at an annual rate of 1.6 percent in
Julyâ€“September, the slowest in more than three years, the Commerce
Department recently reported. By way of comparison, the nationâ€™s rate of
growth was 2.6 percent in the second quarter. What is happening to nearly
slice the growth rate by half in an $11 trillion economy?
In brief, growth in residential housing dropped 17.4 percent in the third quarter. Housingâ€™s fall was 11.1 percent in the second quarter. This downward trend has been underway for the past 12 months in the U.S. economy.
Economists have a word for two straight quarters of declining growth: recession. Is the housing dip forecasting a 2007 recession? That is unclear.
Clearly though, a recession is very bad news for the U.S. working class. On that note, housing has been a motor for employment in the building, financing and furnishing of existing and new homes. â€œLast year, housing could be credited for creating over 15 percent of the year's new jobsâ€; reports the Economic Policy Institute, â€œthis year housing-related jobs will account for less than 5 percent of the economy's new jobs.â€