Finance

Craigslist: A Barometer of the US Economy?

Written by Emily Ferreira on May 15, 2008 1:47 pm EST

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Who would have thought that what was once a young entrepreneur’s hobby would turn out to be a significant barometer of the US economy?

Image credit: acloudman

Craigslist, a macrocosm of the internet, has gained the ability to provide insight into the economy, particularly the softening real estate and job markets which caused the local classifieds site to face negative figures in January 2008. Jim Buckmaster, the CEO at Craigslist, clarified that revenues have traditionally felt a 15-20% increase in past Januarys and profit margins have always been healthy enough to keep the company going strong. He now compares this drastic plunge to the recession of 2001 where unemployment rates skyrocketed and outsourcing became the new trend.

Providing free job listings, housing and real estate listings, and a multiplicity of other listings (electronics, furniture, dates, etc.) has always been what Craigslist does best. Craigslist essentially cuts across all levels of American life, but its pervasiveness has thrown the company under the economy’s bandwagon forcing it to face the deceleration of online advertising and job postings.

The good news is, despite the economic drought, the Craigslist has managed to keep its ground and will continue to meet profits margins that will enable the company (comprised of merely 25 employees) to sustain growth. Buckmaster reported that they plan to add hundreds more city pages and will continue to fulfill the requests of users by creating additional product and service listings pages.