“A Rocky Balboa Recession

[landplanner]

“That all adds up to what one of the Stanford researchers, the economist Nicholas Bloom calls

“Rocky Balboa recession.” It never seems to give up, he says, even when you think it’s dead and buried.”

I have made a conscious effort here in the past (with a few lapses) to cite any articles from economists, economic soothsayers, or biz journalists who have written ad nauseum about our longest recession on record.

I am lapsing again here. This article is from Jim Tankersley of the Atlantic and it is entitled

 

We’re Not ‘Fine’: The 3 Iron Truths of the Recovery

 

For those of you with a real short attention span or an overly nervous mouse twitch, this is the article for you. Here is the link.

http://www.theatlantic.com/business/archive/2012/06/were-not-fine-the-3-iron-truths-of-the-recovery/258378/

After reading it, I can only add three things.

The first is that I would change the title slightly and substitute “Iron” with “Ironclad”

 

Secondly, like most articles of merit dealing with helping us better understand what has and is still going on with this unshakeable economic malaise (sorry JC) this one has its set of supporting graphs. This one bears repeating here, in case you can’t bear to get through the entire article. It is by far the most compelling of them all, and you might have seen it before.

This is an ESTIMATE of the number of construction jobs lost since the peak in 2006.  Of the somewhere near 8 million jobs lost from that peak till the official end of this never ending recession in or around sometime in 2009, 2 million of those total jobs were in construction.

 

 

Those were just the jobs directly or nearly directly (e.g. building material suppliers) related to construction. I could be mistaken here (I hope I am), but I do not think this accounts for semi-factual and anecdotal estimate of about a 30% or higher job loss in the design professions. Quite a nosebleeding, stomach-swallowing plunge there eh ?

Thirdly, for those of you who naively believe any of the following:

• The housing market has bottomed and we are on our way back
• We will be clocking monthly job creation numbers of 250,000 and up in the coming quarters
• There will a second stimulus and jobs generating initiative (call it New Deal 2.0) that will right our listing national cruise liner or
• that Facebook was the best IPO since Google or Netflix

Please send me some of that reality-bending, mind altering delusional, one puff stuff you have been inhaling recently or since all this mayhem started. Stash it in the bottom right-hand corner of the gigantic portrait of Mao in Tianemen Square. If I am fortunate to get to visit Bejing while I am here, we can coordinate the delivery. I will be all stealthy, and wait till no one is looking during the changing of the guard. Should be a cinch.

 

 

 

 

 

[Roland Beinert]

Why can’t we have a Rocky and Bullwinkle recession instead?
This can’t last forever, though. We still have aging infrastructure, more people wanting rental units, cities in need of better pedestrian and bike facilities and plenty of other countries that are developing. We may be faced with a new norm, but not the end of the world. We just have to try to anticipate, and maybe even encourage, the next big trend.

[landplanner]

Roland:

 

Thank you for your lighthearted but well-intentioned reply. I regret that I sunk into a snarky and cynical mindset in my posting and commentary here and probably discouraged or insulted some people in doing so, for that my regrets.

 

I see things the exact same way you. We will get through this “new normal”

Last time we had anything approaching this it took us 10 years,  bold,daring political leadership and the cooperation of both parties and a war.  We have nothing but political gridlock now, no truth telling and no decisive initiative from our leadership, or lack thereof.

At there is one group out there that thinks we got it right the first time and could do it again.

http://www.rooseveltinstitute.org/new-deal-20

 

I am a true-blue die-hard progressive and buy into most of what this group thinks and espouses but they are decidedly in the minority of public opinion and political wil at present.

[Andrew Garulay, RLA]

So, what is it that we hated about the “old normal” that makes people want to accept this “new normal”?

At some point it should become clear that the “old normal” was the best thing on the planet and in the history of the world.

[landplanner]

Again another on-target statement that makes reconsider. The “old normal” was a zenith of a time for some of the greatest, most revered and praised accomplishments of our country. Architects, landscape architects and artists did some amazing things during that time that are cherished places and spaces throughout our country. Timberline Lodge comes to immediate mind…..

It would first take a coherent and convincing political movement and visionary individual at the forefront of that movement to become an unstoppable force change and goodwill. I just do not see anyone capable of that right now, nor after November 2012. Any suggestions ?

[Roland Beinert]

I see what you’re saying Andrew. I’m not saying any of what you love about the old normal will disappear completely. I just think it’s time for the developed world to look back,realistically assess what we’ve done for the past several decades and refine it:
-It should be obvious that our infrastructure needs repair. No one wants bridges crumbling beneath them.
-Single family housing won’t and shouldn’t disappear. It’s just that there’s already way too much unaffordable single family housing. It was only affordable with a mortgage.The demand is for rental and smaller affordable starter homes, unless we want to go back to borrowing to buy way more than we can really afford.
-We over-built for the car. Now we need to go back and add infrastructure for pedestrians, bicyclist and transit users, who we almost completely ignored. Not everyone wants or needs a car. I can’t even afford to get mine repaired.
-We need to rebuild our inner cities, because, believe it or not, people actually do want to live there.
-I don’t think the US and other developed countries will cease to be economic power houses or that we’ll be taken over by the Chinese or something. It’s just that there won’t be as much demand for building here and we’ll have more countries competing with us.
-The leaders who will get us out of this mess will be the ones at the bottom, not the top. Mayors, city councils, activists, economic development groups, entreprenuers, etc. will be the ones who get this started. Then the people at the top will take credit for it:)
-Actually Obama has said repeatedly that we expect too much of the office of the president. He can’t do much if we don’t. I agree with him, but I suppose the rest of the country is in blame-mode right now.

[Jamie Chen]

From the professional magazines I read that my landscape design/build/maintenance company receives, things are picking up on the maintenance side. 

People are choosing to maintain the properties that they have and the people who do have their own properties are the most secure at this stage. It makes sense that they would protect their interests with upped lawn care, upgrading aging sprinkler systems, the works. 

My company’s irrigation division is always ready and eager to upsell landscape design services to the sprinkler repair clients. They have to dig things up anyway and now there’s mounds of loose soil. Why not do something nice and designed? 

Perhaps fewer landscape architects can go it alone in the new normal. Perhaps a lot of us have to hook ourselves up to the the landscape maintenance side and value add on that end. 

It’s another avenue of adaptation available to everybody. 

[landplanner]

Roland:

 

I’m completely onboard with you that it will be a relatively local from the ground-up groundswell movement, if and when we have had enough of these conditions,  As far as rental and affordable housing goes, I have had a long-standing interest in community land trusts that are formed to provide this. I have never had the privelege to work on a project like that, and wonder how they are doing these days with capital lending being so hard to find right now.

The apopalyptic James Howard Kunstler thinks that the turning point for all of this, will be in the streets of both political parties conventions this year in Tampa and Charlotte. The direction he thinks it will turn is not a pretty one. Being the supremely sarcastic kind he can be, he plans to be in both places and open up a pitchfork concession, He thinks he will make a killing.

[landplanner]

Jamie:

 

I think your onto something here. My completely unscientific survey shows that there are far more employment ads for landscape maintenance and design/build landscape contractor employment opportunities currently (and this has been the case for quite some time) than for landscape architects.

 

I am aware of some landscape architecture firms that have made a concerted marketing effort to develop relationships with property management companies and HOA’s in search of landscape upgrade and landscape enhancement projects. How successful they have been in that venture, I have no idea.

[Roland Beinert]

Here’s a link to an article supporting what I was saying: http://www.usatoday.com/money/economy/housing/story/2012-05-15/housing-fills-in-urban-areas/54979594/1

[Heather Smith]

Since we know a lot of design/build business is picking up while the larger design firms are languishing I think it points to the large decrease in public spending and the fact that many private individuals still have money, some of them a lot. In our little town we have very large firms from large cities competing for public projects they wouldn’t have looked twice at five years ago. The pool that is finding work in the field, small scale residential design/build faces no competition from these large firms. It makes me think that the large firms will be battling it out for a while, a few will be left standing and we will see many smaller firms picking up work. Of course, these small firms like ours can’t make it on design fees alone, so we sell the build…that is the real money maker. The larger firms have a much harder time competing because they have such high overhead and they only sell design. In many ways, this creates a scenario that offers more opportunities for individuals to have chances they never would have a few years ago. Maybe we should be looking at this as a positive, instead of a negative. Streamlined services for the client, opportunity for young professionals to hone their skills in the field. In reality, the only thing we can do is to take this as a chance to make our own way. In the long run, those left…whether it is tomorrow or 5 years from now, will be in a nice spot professionally. There still won’t be enough LAs and I do think you will see an increase in public spending out of necessity.

[Boilerplater]

From the article: “Huffines is developing Viridian, 5,000 units on a 2,300-acre site in a flood plain near a landfill in Arlington, Texas.”

 

Sounds like an awesome site!  I have to pay for flood insurance, live with the risk of flooding AND I get to smell landfill stench all the time?!  AND its in Texas!  I’ll be surrounded by Conservatives!  I’m applying for a mortgage right now!

[Roland Beinert]

Viridian is a bluish color, right? So I guess the name of the neighborhood symbolizes that it will be under water at some point.

[Anonymous]

I’m actually considering going into design/build/maintain, primarily so that I can have some control over how my projects are installed and secondly the profit off the mark up on materials. But I think that there will always be landscape design only firms. It’s just too hard (if not impossible) for a municipality, a developer or a residential estate owner, etc. to get a fair “apples to apples” bid and who’s going to be looking out for the owners interest during the construction?   

[Heather Smith]

Yeah and in our neck of the woods they don’t even put out design/build bids. It is always separate. We already do a separate design contract from the build work, so there is no guarantee either way. A design/build firm could still put in a bid that could be compared…I think it is actually a lot more efficient to have the person designing oversee the build work. Around here you see a lot of large projects won by the cheapest bidder and it usually looks like it is cheap.

If you have the ability to do your own build work I would do it. You are correct, the material costs increase our profits, which increases our ability to offer professional work. We have clients that don’t want to spend so much and that is okay, we decrease the scope of the project, not our profit/overhead. Like I said, I think many individuals still have money to spend on residential projects and some of them have great taste!

[Author]

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