Eye On Housing
The Bureau of Labor Statistics (BLS) reported the Employment Situation for May 2018. Jobs increased by 223,000 and the unemployment rate edged down to 3.8% in May. The growth rate of average hourly earnings accelerated slightly to 2.7%, but growth has largely been flat since 2016.
The release also indicates that the number of construction jobs rose by 25,000 in May, after the 21,000 increase in April. Residential construction employment rose to 2.81 million in May, broken down as 791,000 builders and 2 million residential specialty trade contractors.
Over the month of May, total nonfarm payroll employment rose by 223,000 in May, faster than the increase of 159,000 jobs in April. The April increase was revised down from its original estimate of a 164,000 increase. Job gains have averaged 207,000 a month this year, faster than the first five months’ averages of 172,000 in 2017 and 161,000 in 2016.
Meanwhile, the unemployment rate edged down to 3.8% in May, the lowest rate since May 2000. In May, the number of unemployed persons declined by 281,000. However, the number of people in the labor force rose by 12,000 because the total number of employed persons climbed 293,000. The decline in the unemployment rate largely reflected fewer unemployed persons, but also a small increase in the labor force. Despite the small increase in the labor force, those not in the labor force rose faster (+170,000), leading to a slight decline in the labor force participation rate, from 62.8% in April to 62.7% in May.
Over the past 12 months, average hourly earnings increased by 2.7% in May, faster than the 2.6% growth registered over the previous three months. However, the figure below indicates that earnings growth has been volatile around 2.6% since 2016. In addition, earnings growth remains below the growth rates that prevailed 10 years ago.
Monthly employment data released by the BLS Establishment Survey indicates that the number of construction jobs rose by 25,000 in May, after the 21,000 increase in April.
Residential construction employment rose to 2.81 million in May, broken down as 791,000 builders and 2 million residential specialty trade contractors. The 6-month moving average of job gains for residential construction is 13,183 a month. Over the last 12 months, home builders and remodelers have added 132,300 jobs on a net basis. Since the low point following the Great Recession, residential construction has gained 827,400 positions.
In May, the unemployment rate for construction workers decreased sharply to 5.0% on a seasonally adjusted basis, after a 6.5% in April. The unemployment rate for construction workers dropped to the lowest rate since 2001, as show in the figure below.
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