Economy Watch: Healthy Job Creation in February; Mortgage Delinquencies Continue Downward; Household Net Worth Up in 4Q
- Mar 08, 2013
By Dees Stribling, Contributing Editor
The U.S. economy created 236,000 jobs in February, according to the Bureau of Labor Statistics on Friday. That’s a considerable improvement over January, when 119,000 jobs were created, and compares favorably with the 2012 monthly average of 181,000 jobs created per month.
The official unemployment rate edged down 0.1 percentage points to 7.7 percent, more-or-less where it’s been since September 2012. Employment increased in certain categories, such as professional and business services, construction, and health care.
Separately, the U.S. Department of Labor reported on Thursday that for the week ending March 2, initial unemployment claims were 340,000, a decrease of 7,000 from the previous week. The less-flighty four-week moving average of unemployment claims was 348,750, a decrease of 7,000 from the previous week.
Mortgage Delinquencies Continue Downward
According to LPS on Thursday, 7.03 percent of U.S. mortgages were delinquent in January, down from 7.17 percent in December. The drop was even more pronounced year over year, since in January 2012, 7.67 percent of mortgages were delinquent. The company counts as delinquent loans that are more than 30 days overdue, even those 90 days or more overdue but not yet in the formal foreclosure process.
As of January 2013, 3.41 percent of mortgages were in the foreclosure process, compared with 3.44 percent in December, and down from 4.23 percent in January 2012. LPS says, however, that significant differences continue in foreclosure pipelines between states with judicial and those with non-judicial foreclosure processes.
“At today’s rate of foreclosure sales, it will take 62 months to clear the inventory in judicial states as compared to 32 months in non-judicial states,” LPS Applied Analytics senior vice president Herb Blecher said in a statement. “A few judicial states – New York and New Jersey in particular – have such extreme backlogs that their problem-loan pipelines would take decades to clear if nothing were to change.”
Household Net Worth Up in 4Q
According to the Federal Reserve on Thursday, U.S. household net worth at the end of fourth quarter 2012 was about $66 trillion, up about 1.6 percent ($1.1 trillion) from the end of the third quarter, and up 9 percent from the end of 4Q11. Household net worth peaked at $67.4 trillion in the third quarter of 2007, then dropped by $16 trillion by the beginning of 2009.
Household debt increased at an annualized rate of 2.5 percent in the fourth quarter, the Fed reported. Home mortgage debt was down 0.75 percent, continuing the downward trend that started in early 2008, while consumer credit rose at an annualized rate of 6.5 percent during the quarter.
Wall Street set another record on Thursday, but otherwise the day saw only tepid increases for all the indices. The Dow Jones Industrial Average gained 33.25 points, or 0.23 percent, while the S&P 500 was up 0.18 percent and the Nasdaq advanced 0.3 percent.