Time to step out of Architecture. The recession coming.


So we know its a cyclical industry. I don't know about you guys but I'm starting to see the next one coming. 

The market I am in has housing problems but no one is building condos (liability issues, conversation for another post) the new construction on the market will soon have apartments saturated, already starting to see rent prices begin to stabilize even drop, even though home prices continue to rise. Foreign investment is hitting the breaks because of high construction prices, rising material costs/tariffs are all taking a bite out of the ROI. Speculative design work that is 2+ years down the road is looking less attractive. Is it time? What are you seeing? Just my market? or are these jitters real? 

May 11, 18 2:37 pm
Non Sequitur

Def not in my market... we can't get commercial and residential projects build fast enough for demand.  Our concern is the lack of labour (trades to professional) available to deal with the next 10y of construction currently in progress... but then again, I'm not living under Trump.

May 11, 18 3:06 pm

we're seeing developers still interested in residential.  i assume once apartments get saturated, the people that live in the apartments are going to want to go shopping so retail and entertainment will pick up.

May 11, 18 3:08 pm

We can't hire fast enough right now, both where I'm at and across our global markets.

May 11, 18 3:19 pm
What metro market are you in Jonathan?

I'm in Chicago and we're seeing big cost increases in wood and steel materials that suppliers are telling us is specifically due to tariffs, first on Canadian lumber and then anticipated on foreign steel. I confess to feeling a bit jittery lately although we are definitely seeing plenty of projects continue to roll in.
May 11, 18 3:31 pm

Multiple markets on the West Coast


Seattle makes me the most nervous


Step out and into what?

May 11, 18 4:03 pm

Indeed. All anyone can really do is try to keep their expenses under control and build up a decent cash nest egg to get you through the lean times.


I don't really know.I feel like working in construction would be viable longer into a recession. Maybe something more focused on infrastructure work. Speculative/design stuff tends to dry up quickly. Facilities management, or in house design for a larger company not as directly tied to the market.


You may want to consider in-house positions at government agencies or big non-profit enterprises like hospitals or universities.

Wood Guy

I just switched from design-only to design/build, in part to be better prepared for a downturn. (And also for more positive reasons.)

wurdan freo

something more comfortable perhaps???

May 11, 18 4:28 pm



The definition of a bubble is that no one sees it coming, or, if they do, they rationalize it away.

May 11, 18 4:56 pm


There is something called regional recessions. Not all recessions cycles will or would be nation or international in scale. Seattle might be undergoing a local/regional recession due to over speculation development and will inadvertently have a slow down. It might not be very deep like the 2007/2008 recession. At least, not yet. Most of what we have been experiencing the past few years was from the Obama administration and we have yet to see the implication of Trump Administration's impact but the economy side was already in motion prior to Trump. 

May 11, 18 5:14 pm

Population growth and employment growth are the surest indicators of how a region is doing in terms of the demand for architecture.

May 11, 18 5:19 pm

If we restrict immigration too much we could trigger a recession.

Volunteer: The definition of a bubble is that no one sees it coming, or, if they do, they rationalize it away.

Volunteer has it exactly right ... during the 40 years I practiced before retiring I suffered through quite a few recessions and one near-depression. Industry wide it always happened precisely as Volunteer describes.

May 11, 18 8:44 pm

Bubbles make everybody look smart.   When even the stupidest people are making money, look out.

May 11, 18 9:00 pm

Will there be another nation wide recession, possibly. But one not necessarily as big as the 2007/2008 recession/depression. It might be barely noticed and might not impact the whole country at the same time. It might be more of a rolling recession where some regions enter and even possibly exit it before some regions even begin. This depends on how the economics play out. 

May 12, 18 1:30 am

Maybe it's an American thing (that does tend to affect us Canadians) but we're not seeing it yet. I work exclusively with developers, all of whom are still building at the same pace. We are very affected by the oncoming American tariffs, but buffered because we have more government employment. At least locally, we weren't really affected by the last recession either, though we are now building all apartments and no condos, while even 5 years ago, it was 50/50.

May 12, 18 5:53 pm

who lives in these apartments?  They cost way more than my house.  a lot of them are bigger than my house too.  it can't be young professionals, at least not on what my income was as a young professional.  is it families?  are we going to see a bunch of crying babies and kids running around the swimming pools?  retirees or empty nesters maybe?

May 12, 18 7:29 pm

a significant group Young professionals (not true for everyone) tend to not have much savings and they are debt burdened by student loans, they can afford 2-3k a moth for housing but they do not have the cash to make a down payment on a condo or house. They want to live a certain lifestyle but also have the ability to leave a city/job market for another without being tied down by real-estate. Some folks do not look at home ownership as a safe means of building wealth anymore.


Residential real estate has done very well in most markets since the bottom of the Great Recession. If you could have bought in then, you would have made out like a bandit. A house is still the best way of accumulating wealth for most middle class people. You get tax advantages, deferral of capital gains, and of course shelter. Bonds would scare the shit out of me right now.  One big bout of inflation is going to change a lot of millennial minds when it happens.


There is a cycle but I think we are still a year or two out unless Donald Trump completely removes everything Obama did to bring economic conditions of our country out of the recession but it can be still a year or so before the effects of Trump's administration show its effects in the housing market. There are market areas that had been somewhat outpacing the real demand. Seattle had alot of speculative demand but it might be outpacing the real housing demand by those who can afford the housing. This could result in a slow down in the local region but it is about a year or two before I would say we are due for a national scale recession. However, it might not be as deep of one. Conditions aren't necessarily the same but there is slow downs which is what most recessions looks like or at least.... the theory is that is how they should look like.


geezertect, millenials aren't going to own property until they are about to retire. The work life of our modern age is like being in the military. Jumping from place to place. We have a vagabond work culture these days. Until we return to the work life of the pre-1960s, where people customarily stay in a place for most of their working career and retirement. I'm talking 50+ year residency over one's life time. After the 1960s, the way people live and work changed.... well transitioned.... into the vagabond work life of today where you are better off owning an RV / Mobile Home vs. a regular house. Why own a house just to sell it off in 5 to 10 years. You just keep compounding you in-debt status.

As long as you remain an employee of others, that's your life-style if you want to keep your job and career.


You don't need to stay in the same house for 50 years. As long as you don't move out of area more often than 8-10 years, you still are better off buying than renting. The inflated equity in one house makes the down payment on the next. You have no hope of retiring if you get to 65 years old and you still don't own the roof over your head. Besides, constantly moving across country to chase the mediocre opportunities of this profession is a fool's errand. JMHO.


In many parts of the country the tax payments are more that the principal and interest on the loan. A person would be better off in a low tax state at retirement with a small mortgage in many instances. House prices do not always go up, either, as the bust of a few years ago can attest. Another problem is that if you move into an area with very high prices the rent prices will be high also. Still another factor to consider is that if you are working in a high cost of living area and your employer is giving you an adequate allowance for the area your eventual SS payment will be significantly higher. To bounce around in this industry from one miserable paying job to another in one high cost of living area to another is really a poor choice. You would be better off getting a teaching job in a pleasant college town and architeching on the side. Just my opinion.


I love these arguments about how millennials don’t want to buy a house. We’d love to buy a house but unless your parents were wealthy or you are in medical ain’t happening. I can’t justify moving out to somewhere near the 1950 atomic tests just for

Non Sequitur

I miss the millennial cut off by just one year... Going on 3 years for house ownership and it ain't some developer box in the suburbs. No plans to move either since I'm well invested in the city's future plans. Certainly helps that I had an active role and inside information on the direction of urban developments and public transit.


Free school up there right Non?

Non Sequitur

Almost free, I think undergrad tuition was under $6k (cad) per semester and grad school $3.5k per semester (3 per year) before scholarships for me. Would have been free if I lived in Quebec, but I don't because that would be terrible. We're about to have an election this summer (provincial) and some are proposing literally free tuition. Same school tuition is now $10k per year undergrad and grad is actually less @ $2.5k. All dollar amounts in canadian currency, so that's like what, 0.60can = 1usd?


Some US schools still have reasonable tuition. Georgia Tech is $10,000 (US) a year, for example. Those who want to get ass-raped by the Ivys for a sub-standard education are the ones that asked for it.


"I miss the millennial cut off by just one year... Going on 3 years for house ownership and it ain't some developer box in the suburbs. No plans to move either since I'm well invested in the city's future plans. Certainly helps that I had an active role and inside information on the direction of urban developments and public transit." 

What year? I don't know what is the definitively set cutoff year. I seen the year numbers bounce around from source to source. Anyone within the last 2-3 years of the statistical average between sources regarding Gen X and the first 2-3 years of the Millenials of the statistical averages are in the transitional period and are basically Gen X-Millenials. 

In some sources, I'm in the millenial category and in some, I'm in the Gen. X. So it's confusing that way. For me, I'm sort of odd that way because I'm Gen X and Millenial. Hmmm.... Such is life. No need to dwell a major discussion on. If you are in that zone, feel free to identify with both generation x and millenials.

Non Sequitur

Ricky, I've looked at the Wiki page following my post and I hit about half of the various age descriptions. I've always just remembered gen X from high school and will stick to that... although I despise labels.


Right. Me too. Damn.... that became a label. I kind of in the middle between one generational culture and another. So in a way, it's okay to associate and be identified with both "generation X" and "generation millenials" without caring about the labels.


I do agree with the Wiki article that Generation X and Millenials are the first generations to grow up with home computers. But Generation X would be the first generation introduced to home computers in 1977 because they would be the ones introduced to computers between 1977 and 1985 before the earliest born Millenials came to age to use a computer. (Lets say, age 4-6 years old being the introductory age). Some of us in that transition may have an older sibling that would fall into the generation x (more consistently) and were 6-10 or even in their teens at the time. Baby boomers were already adults when home computers were introduced in 1975/1977 so they would likely not be deemed to have grown up (between birth and 18 years of age). Before 1975, computers were kit computers like the Altair. We are basically part of the "Nintendo generation". (Namely for the NES and SuperNES)

I'm not generally fond of labels but I'll go with NES/SNES generation or "Nintendo generation" in that context !!!! 

Non Sequitur

Ricky, NES generation it is!


So much cooler !!!!


i am in socal and i work with apartment developers. there was a slow down in the market from fall 2016 until after the tax deal was inked. it has since perked up some.

there are areas that are overbuilt, property costs are high, labor is high and the cost of materials are high. it's taking a lot longer for developers to raise $ for soft costs. interest rates are rising. top banks are starting to divest their multifamily assets to reduce their exposure.

rents are high, luxury properties are having to comp 1 or 2 months of free rent to entice renters. rent in los angeles is stabilizing, only 2% annual rental increase nowadays.

demand for apartments is still relatively strong with a need for housing for regular working class folks. luxury apartments and subsidized affordable housing is about all that's been built around here for the last few years.

i have two large scale apartment projects currently under construction, and a couple more starting construction in the fall as long as the construction funding comes through. doing quite a bit of value analysis at the moment...

May 12, 18 9:04 pm

It's always good to step out of architecture, recession looming or not...that Make Architecture Great Again didn't really work out then?

May 13, 18 4:42 am
null pointer

Bullshit. I'm turning down jobs left and right and have my pick of the crop.

If I could split myself into three clones (2 slaves) with the same brain I'd be a millionaire.

May 14, 18 2:58 pm

in a year or two, there might be a recession, and this will result in another culling - I'm preparing for that, so that I wont get pushed out

May 14, 18 4:26 pm

My experience leads me to believe it’s more a game of musical chairs in production. Whose project is still active has more bearing than who stays the latest.


That definitely seems true at my office. We don't feel close to a recession, but if the client puts a job on hold, it seems to take forever (2-ish weeks) for the higher ups to figure out where to put you. Part of it is they're hoping the project starts back up, another part is mid-tier people not being able or at least not willing to divide tasks and share a project with you. If you're able to handle 3-5 projects at a time, losing one doesn't hurt, but if you're on 1 big project and it stops for some odd reason, things seem to go sideways for you for a month. I'd imagine that this same process (or lack there-of) during a recession would result in multiple months of mid-tier people looking for something to do each week, and the lay-offs would not be far behind.


Yes, and the management people picking who gets laid off may or may not know what the hell is going on in terms of who is actually doing the work. Productive and knowledgeable people often get laid off and the office politicians and ass-kissers get to keep their jobs.

( o Y o )

Pot, meet kettle.

May 14, 18 9:54 pm

When the recession hits either head for a government job or a work with a firm who has government work.  Governments typically spend their way out of a recession and government projects have in my experience always been quite plentiful when the private sector starts to tank.

May 15, 18 12:18 pm

government work and healthcare and in some cases, educational institutions. Good places to work in during that time from what I've heard. 

I have something in the works myself but somewhat outside the conventional built environment. 


Always be wary of firms that only do one kind of private sector work, places that only do car dealerships, or only hotels.  In good times they prosper and the firm leaders think they've caught lighting in a bottle, right up until the economy tanks. The work dries up and it's too late to diversify into other project types.  Recessions hit practices like that really hard.

May 15, 18 1:07 pm

Rarely th


Education sector seems to bypass this


what if all your office does is multifamily in the Bay Area?

May 18, 18 2:30 pm

Run Forrest, Run!


Go work for silicon valley tech/video game industry as a UX/UI Designer & 3d Modeler/animator. Well be good and capable in all facets of 3d and 2d design and user interface and user experience and get a healthy $115K-$125K salary.

You know it is high pace competitive environment ripe with silly con politics and drama.   :-)


That's were I came from - Rockstar Games
May 18, 18 4:17 pm

Did you go to architecture school after having a career in the Games industry?


Cool! I was just playing a little with you. In a software project that I'm working on, I'll probably will eventually need to involves architects like yourself. I'll be willing to explain under an NDA for the time being. It maybe perplexing but understood better under the context but without giving away too much info public at this time. You know the 'game' of the software/video game industry.

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