The economy continues to produce jobs at a modest pace, although wages gains remain weak according to the most recent labor market reports from the Bureau of Labor Statistics. Improvements in both areas should help support growth in both owner-occupied and rental housing demand in the coming year.
In October, home builders and remodelers added 8,000 jobs to the residential construction sector on a seasonal adjusted basis according to NAHB analysis of BLS data. Over the last 12 months, the industry has created 131,000 jobs. Since the low point of industry employment following the Great Recession, the residential construction industry has gained 333,700 positions, although employment remains 1.132 million lower than the peak level seen in early 2006. Employment growth for the sector has been steady recently, adding on average just a little more than 10,000 jobs per month over the last six months.
Of course, national employment conditions are a key factor driving housing demand. According to the most recent BLS data, total nonfarm payroll employment grew by 214,000 on a seasonal adjusted basis in October. After upward revisions for September and August, the economy added 673,000 positions over the last three months. In the separate household survey, the national unemployment rate fell from 5.9% to 5.8% in October. Real wage growth continues to lag, posting only a 0.1% pickup in October after a 0.2% decline in September.