Grand Rapids, MI -- (SBWIRE) -- 01/03/2011 -- Noted financial advisor Dennis Tubbergen ties the poor housing market to unemployment, a major concern in the U.S. for the past year or two. Tubbergen, who is CEO of USA Wealth Management, LLC, a federally registered investment advisory company, frequently writes about the housing market and unemployment in his blog and his monthly financial newsletter, Moving Markets?.

“The national, official unemployment rate jumped to 9.8% in November, up two tenths of 1% from October,” explains Tubbergen. “The jump in the unemployment rate surprised many economists who were expecting another decline. Since the housing market and the employment rate are very closely linked, this rise in the unemployment rate is not good news for the housing market.”

Tubbergen refers to an interesting figure in Gary Shilling’s December issue of Insight, an economic research newsletter, which states ‘the level of full-time jobs today is at about the same level as in December of 1999.’

“When you stop and consider that for a moment, it’s significant,” claims Tubbergen. “The number of full-time jobs 11 years ago is about the same level as the number of full-time jobs today – that’s 11 years of no net progress.”

Tubbergen believes there are several reasons for our current low level of employment.

“First, access to the credit needed to grow or invest in a business is very limited,” states Tubbergen. “Cash from credit cards, home equity loans, and other ‘normal’ sources of business financing is scarce. If businesses can’t obtain capital to grow, they are typically unable to expand and hire employees.”

According to Tubbergen, Shilling makes another interesting observation in his most recent newsletter: The number of U.S. businesses in existence employing at least one employee dropped by 100,000 or 2% in the year ending March 31, 2010. The previous year saw a drop of 3.4%.

“My second reason for low levels of unemployment: much of the hiring is now being done on a contract basis or a part-time basis,” notes Tubbergen. “A Duke University/CEO Magazine study on employment found that 23% of all recent hiring was either on a contract or a part-time basis. That’s up from 17% prior to the start of the recession.”

Tubbergen’s last reason for high unemployment? The government stimulus has not really worked. Tubbergen explains the stimulus plan passed by Congress forecast the then 7.7% unemployment rate would reduce to 7% in the fourth quarter of 2010 as a result of the stimulus. Absent the stimulus, politicians told us unemployment could reach 8%.

“Even with the stimulus, the unemployment rate has far exceeded the projections made about 2 years ago assuming no stimulus was passed,” concludes Tubbergen. “The favored political solution to almost any problem is to throw money at it. In my view, that solution won’t solve a problem caused by excessive debt. Long-term, look for unemployment to remain in the headlines.”

For more information on Dennis Tubbergen’s views, visit http://www.dennistubbergen.com. To view his latest Moving Markets? newsletter, go to http://www.moving-markets.com

The opinions expressed herein are those of the writer and not necessarily those of USA Wealth Management, LLC. This update may contain forward-looking statements, including, but not limited to, statements as to future events that involve various risks and uncertainties. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual events or results to differ materially from those that were forecasted. Therefore, no forecast should be construed as a guarantee.

Prior to making any investment decision, individuals should consult a professional to determine the risks, costs, benefits and fees associated with a particular investment. Information obtained from third party resources is believed to be reliable but the accuracy cannot be guaranteed.