Eye On Housing
The labor market continues to be very strong as total employment increased by 134,000 and the unemployment rate declined by 0.2 percentage point to 3.7% in September. Residential construction employment increased by 4,400 and has risen by 139,600 over the last 12 months.
In September, total nonfarm payroll employment rose by 134,000, following the increase of 270,000 jobs in August, according to the Employment Situation reported by the Bureau of Labor Statistics (BLS). The August increase was revised upward from its original estimate of a 201,000 increase. Job gains have averaged 208,000 a month in 2018, faster than the first nine months’ averages of 170,000 in 2017 and 206,000 in 2016.
Meanwhile, the unemployment rate fell to 3.7% in September, after 3.9% for two consecutive months. In September, the number of unemployed persons decreased by 270,000 while the number of employed persons increased by 420,000. As a result, the number of individuals in the labor force increased by 150,000. The labor force participation rate remained at 62.7% in September.
Monthly employment data released by the BLS Establishment Survey indicates that the number of residential construction jobs rose by 4,400 in September, after a 12,000 increase in August.
Residential construction employment now stands at 2.84 million in September, broken down as 799,000 builders and 2 million residential specialty trade contractors. The 6-month moving average of job gains for residential construction is 6,717 a month. Over the last 12 months, home builders and remodelers have added 139,600 jobs on a net basis. Since the low point following the Great Recession, residential construction has gained 853,000 positions.
In September, the unemployment rate for construction workers rose to 5.0% on a seasonally adjusted basis, after reaching the lowest rate of 4.0% in August. The unemployment rate for the construction sector has been trending downwards since February 2010 and remains historically low.
I believe we may have reached the point where new job creation is being slowed by the fact that employers cannot fill existing jobs.