OMAHA, Neb. (AP) — Billionaire investor Warren Buffett said Friday the nation's employment picture will improve significantly once residential housing construction rebounds.
Buffett spoke to Bloomberg Television Friday morning as the Labor Department released a weaker-than-expected monthly jobs report. He said the report shows the economy is still a long way off from where it should be, but Buffett remains optimistic about the recovery and sees no danger of a second recession.
"I would bet very heavily against that," Buffett said. "How fast the recovery will come I don't know, but I see nothing that indicates any kind of a double dip."
Most of Buffett's comments were focused on the long-term outlook. Buffett said he expects unemployment to fall to about 6 percent within a few years, and the 2.5 million jobs lost in the recession will be replaced. The June unemployment rate rose to 9.2 percent.
The chairman and CEO of the conglomerate Berkshire Hathaway Inc. said he thinks people will be surprised how quickly employment improves once the excess houses are bought and normal levels of construction resume.
"We will come back big-time on employment when residential construction comes back," Buffett said.
For a time, Buffett said the housing industry was building about 2 million homes a year while roughly 1 million households were being formed, and the nation is still working off that excess created during the housing bubble.
Buffett said an increase in housing construction will prompt a variety of businesses to hire more workers, including such Berkshire units as Shaw Carpet, Acme Brick and the Burlington Northern Santa Fe railroad.
Buffett was in Sun Valley, Idaho, attending the annual conference hosted by investment bank Allen & Co. that attracts Wall Street and media moguls.
Buffett's Omaha-based Berkshire owns roughly 80 subsidiaries, including railroad, clothing, furniture and jewelry firms, but its insurance and utility businesses typically account for more than half of the company's net income. It also has major investments in such companies as Coca-Cola Co. and Wells Fargo & Co.
Berkshire Hathaway Inc.: www.berkshirehathaway.com