Economy Watch: Jobs Growth, Home Sales
- Nov 10, 2014
The gains in U.S. employment in October, which totaled a net of 214,000 jobs, were fairly widespread across various industries, the Bureau of Labor Statistics reported on Friday. For example, food services and drinking places added 42,000 jobs for the month, compared with an average gain of 26,000 jobs per month over the prior 12 months. Employment in retail trade rose by 27,000 in October, compared with an average monthly gain of 21,000 over the last year.
Also in October, U.S. manufacturing employment continued on its upward trend, gaining a net of 15,000 positions, while the construction industry added 12,000. Employment in professional and business services continued to trend up over the month (up 37,000), though not as much as recently, since over the past 12 months, job gains in that category averaged 56,000 per month.
The number of long-term unemployed—which the BLS defines as those jobless for 27 weeks or more—was 2.9 million in October, which accounted 32 percent of the total unemployed. Over the past 12 months, the number of long-term unemployed has declined by 1.1 million.
Some 2.2 million people were marginally attached to the labor force last month, according to the BLS, meaning those individuals who weren’t the labor force, but who wanted and were available for work, and had looked for a job sometime in the prior 12 months. They’re not counted as unemployed in the headline number because they hadn’t searched for work in the four weeks preceding the survey.
The BLS’ U-6 unemployment metric, which adds together the conventionally unemployed, plus everyone marginally attached to the labor force, plus total employed part time for economic reasons, came in at 11.5 percent in October. That’s down from 11.8 percent in September and 13.7 percent in October 2013.
Realtors Predict Strong Home Sales Next Year
Existing home sales are expected to be higher next year and prices will remain at a healthier level of growth, the National Association of Realtors asserted in an economic forecast released last week. Existing home sales this year are expected to fall below the 2013 level (5.1 million units) to 4.9 million, but are forecasted to increase to 5.3 million next year and 5.4 million in 2016.
NAR chief economist Lawrence Yun said in a speech during the 2014 Realtors Conference & Expo last week that existing home sales this year got off to a slow start, but have recently shown stronger growth, slower price gains, and pent-up demand. “The improving job market has consumers feeling more confident, and the rebound in home prices is building household wealth for homeowners and giving them the ability to sell after waiting the last few years.”
Yun also said that multi-family housing starts have rebounded back to normal since the downturn, mostly due to the strong demand for renting. “On the other hand, single-family housing starts are still lagging as smaller homebuilders continue to face difficulty obtaining construction loans, and some have even gone bankrupt,” he said. “Single-family construction still needs to increase to alleviate supply shortages.”
Wall Street didn’t move much on Friday, ending the day mixed. The Dow Jones Industrial Average gained 19.46 points, or 0.11 percent, and the S&P 500 was up 0.03 percent. The Nasdaq lost 0.13 percent.