Manufacturing versus Real Estate

Interesting chart via PIMCO’s Bill Gross, comparing manufacturing employment with tat of Real Estate agents. Recall we visited a related subject  back in April, looking at the bull market in Real Estate Agents.

click for larger chart


Note the two scales are very different. The chart doesn’t specify, but I am assuming that its in 1,000s.

The key takeaway is the ongoing shift — now in its 3rd decade — away from a manufacturing economy and towards a services ased one.


“Lunch” Time
Bill Gross
PIMco Investment Outlook, September 2005 (PDF)

Print Friendly, PDF & Email

What's been said:

Discussions found on the web:
  1. spencer commented on Sep 7

    The difference in scale is more then 10 times.

    Yes, manufacturing employment is declining and
    services employment is rising.

    But this chart of two things on such a divergent scale that it
    has the apperance of being a deliberate distortion. I think it is just sloppy thinking.

    Real estate employement is still only some 10% of manufacturing employment — at least from reading the data off the scales.

  2. Barry commented on Sep 7


  3. Tom commented on Sep 7

    Yes this is sloppy thinking. If the upper limit of the RE agents is read off the left axis (1480) then we’ve never really intersected the loss of manufactor jobs (currently 14250).

  4. Rich Berger commented on Sep 7

    Not only are the scales different, but the ratio of low/high Y axis values is not the same. The effect is to exaggerate the increase in real estate agents relative to the decline in manufacturing jobs. More sage advice from one-time “genius” Bill Gross.

  5. pjfny commented on Sep 7

    you guys are missing the point….form over substance…. the point is that this country is not investing in productive assets, but selling real estate to each other. When (not if) the real estate mkt slows or collapses (your choice), this will have a major impact on the economy. Bill Gross is just the first to verbalize the dreaded R word. My bet is that ths view will grow as we get closer to 2006.

    BLR NOTE: I beat Grosss by a few weeks

  6. Larry Nusbaum, Scottsdale commented on Sep 8

    Hello The Global Economy.
    Btw, do not be fooled by the raw number of agents. Most do not do much business. Many get their license to conduct their own transactions and have zero interest in acting on behalf of others. And, like most sales professions, 80% of the business is done by 15-20% of the agents.
    Btw, as it turns out, the growth in ARM products and I.O.L.s in particular has been incorrectly reported by the media. During the past 4 years they have grown to only 11% of originations. The numbers in California are dramitically higher, of cousre. AND, NOT ONE PERSON HAS BEEN ABLE TO EXPLAIN WHY THIS IS A RISK TO THE HOUSING MARKET.

  7. Zephyr commented on Sep 29

    So “X” marks the spot where 2,000,000 manufacturing employees have bben replaced by only 80,000 real estate employees.

    Of course the location of “X” is completely discretionary, at the whim of the drawer of the chart. Merely shift the scale and you can move the date forward or back, or make the curves steeper or flatter.

    This chart is a cheap deception.

Posted Under