Economy Watch: Housing Starts Gain Ground in April; State Unemployment Rates Mostly Down; Consumer Sentiment Drops

Private housing starts went up 13.2 percent in April compared to March. State unemployment rates were generally lower in April. The mid-May Reuters/University of Michigan consumer sentiment index was 81.8, down from 84.1 at the end of April.

The Census Bureau reported on Friday that private housing starts came in at an annualized rate of 1.072 million units in April, a sizable 13.2 percent upswing from March, when starts were an annualized 947,000 units. The April 2014 rate was also 26.4 percent higher than the same month a year earlier.

Both single-family and multi-family starts were up, though multi-family – always the more volatile of the two – were up more. Single-family housing starts in April were at an annualized rate of 649,000 units, 0.8 percent above the March figure. The April rate for units in buildings with five units or more was 413,000, which was a monthly increase of 42.9 percent.

The issuance of building permits for private housing, which is a forward-looking indicator of the housing market, were at an annualized rate of 1.08 million in April. That’s 8 percent above the March rate of 1 million units and is 3.8 percent above the April 2013 rate.

State Unemployment Rates Mostly Down

State unemployment rates were generally lower in April, the Bureau of Labor Statistics reported on Friday. Forty-three states had unemployment rate decreases during the month, while two states experienced increases and five states and the District of Columbia had no change. Compared with this time last year, 47 states and D.C. enjoyed unemployment rate decreases, one state suffered an increase, and two states had no change.

In April, Rhode Island once again had the highest unemployment rate among the states, 8.3 percent – it overtook long-time jobless champ Nevada in that unwanted distinction some time ago. Energy-boom North Dakota again had the lowest jobless rate, 2.6 percent. All together, 19 states had unemployment rates significantly lower than the U.S. figure of 6.3 percent, seven states and D.C. had measurably higher rates, and 24 states had rates that were not much different from that of the nation.

The largest monthly employment increases in April occurred in Texas (up a net of 64,100 jobs), California (up 56,100), and Florida (up 34,000). The largest month-over-month decrease in employment occurred in Illinois (down 6,800 jobs), followed by Minnesota (down 4,200) and Maine (down 2,200).

Consumer Sentiment Drops 

The mid-May Reuters/University of Michigan consumer sentiment index was 81.8, down from 84.1 at the end of April, and 82.6 in mid-April, according to the university on Friday. Both the current conditions and expectations component of the index were down since the end of last month, despite the recent strong employment report and record highs on the stock market.

Very near the end of the trading day on Friday, Wall Street experienced an uptick, with the Dow Jones Industrial Average gaining 44.5 points, or 0.3 percent. The S&P 500 advanced 0.4 percent and the Nasdaq was up 0.5 percent.