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Monday's layoffs at LP not surprising

READ MORE: Monday's layoffs at LP not surprising
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Construction spending is down, and new home building is way down. For construction supply companies like Louisiana-Pacific, adding it all up has equaled employee layoffs. Monday, LP Corporation announced temporary layoffs for 91 workers at its laminated veneer lumber mill off Route 421. Plantation Building Corporation owner David Spetrino said he's surprised the LP announcement didn't happen sooner. “Especially framing lumber and structural lumber would have fallen off at least a year-and-a-half to two years ago. It's probably more of a testament to them doing what they can to keep their employees in check and stay in play.” LP is the second major construction supply company in New Hanover County to recently fall victim to a slumping housing market. National Gypsum, a dry wall company on Carolina Beach Road laid off more than sixty people when it closed last month. We're not alone here in this area. Last year, national construction spending fell by a record 5.1 percent. New home construction decreased by nearly 30 percent during the same period. Both LP and National Gypsum say they will re-hire the laid off employees when the housing market turns around. For the employees of National Gypsum, Louisiana-Pacific, and their families, it's a challenge that now hits too close to home. Spetrino said while new home construction is way down, high-end custom homes are the exception, and even though many people aren't building from scratch, he's seen an increase in renovation projects.

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Layoffs

NY times just passed an article stating that over 500 billion is going to be used in the industry to help create jobs. Turner and other construction companies in Charlotte are experiencing decline in business

I'm not holding my breathe,

I'm not holding my breathe, but let's hope it recovers soon. I think homeowners throughout NC area a bit concerned right now.

You can't create a demand for houses

Don't hold your breath waiting for the residential construction business to recover. There are too many "like new" homes out there for sale at unbelievably low prices. Those homes are satisfying the demand of those who are shopping. So until the dust from the credit and mortgage market collapse settles, the government can throw ten trillion at it; no one is going to risk their capital building new houses that either won't or can't sell. The magic number right now is 740. If your credit score isn't above that, you're not getting a mortgage at a reasonable rate. That score is high enough that it eliminates half of the people who were buying homes at the peak of the "everyone gets a home" madness. Half of your prosepective buyers can't even get through the front door. Bottom line? If I were a drywaller or a framer, I'd plan on re-training for another career. I don't see a recovery in residential construction for at least three years, possibly far longer if the government's new love of Keynesian Economics falls flat on its face. (My money says it does.) Of course, we shouldn't underestimate the stupidity of politicians, and things could "recover" quickly. (HA!) Congressman Bawney Fwank is already screaming for banks to resume lending to lower income applicants with less than perfect credit histories, which played a major role in creating the current crisis in the first place.