Eye On Housing
Employment growth slowed in September. Total payroll employment rose by 661,000 and the unemployment rate fell to 7.9% for the month. The U.S. labor market continues to recover from the COVID-19 crisis, but admittedly now at a slower pace.
Residential construction employment rose by 22,100 in September to 2.9 million as housing remains a bright spot. Total construction industry (both residential and nonresidential) employment remained at 7.2 million in September. Nonresidential construction employment rose by 7,400, after two consecutive declines.
The 661,000 monthly gain reported in the Employment Situation Summary for September decelerated after a 1.5 million pickup in August. This was the first month below a one million gain, after four consecutive months above that mark. The previous two months’ gains were revised higher. The July increase was revised up by 27,000 from 1,734,000 to 1,761,000, and the August increase was revised up by 118,000 from 1,371,000 to 1,489,000.
After the economy lost 22.1 million jobs in March and April due to the impact of the COVID-19 pandemic and efforts to contain it, about 11.4 million jobs have been created in the past five months, indicating the economy is recovering from the COVID-19 pandemic gradually. In September, total nonfarm employment was 10.7 million lower than its February level.
Meanwhile, the unemployment rate declined by 0.5 percentage point to 7.9% in September. The number of unemployed persons declined by 1.0 million to 12.6 million. Both of them have declined for five consecutive months. The labor force participation rate, the proportion of the population either looking for a job or already with a job, declined by 0.3 percentage point to 61.4% in September and 2.0 percentage points lower than in February.
Leisure and hospitality, retail trade, health care and social assistance, and professional and business services had the significant job gains in September. Employment in government decreased by 216,000 in September, mainly reflecting the decreases in state and local government education. Employment in mining and logging barely changed in September.
Additionally, according to the Household Survey supplemental data, which come from questions added to the Current Population Survey (CPS) since May 2020, in September, 23% of employed persons teleworked or worked at home in the last 4 weeks specifically because of the coronavirus pandemic. Meanwhile, there are 19.4 million persons reported that they had been unable to work at some point in the last 4 weeks because their employer closed or lost business due to the coronavirus pandemic. Among those who reported that they were unable to work due to pandemic related closures, 10.3% received at least some pay from their employer for the hours not worked.
Employment in the overall construction sector increased by 26,000 in September, after a revised increase of 17,000 jobs in August. The number of residential construction jobs rose by 22,100 in September, after an increase of 25,400 in August.
Residential construction employment now stands at 2.9 million in September, broken down as 827,000 builders and 2.1 million residential specialty trade contractors. The 6-month moving average of monthly job changes for residential construction is -6,767 a month, mainly reflecting the largest job loss in April. Over the last 12 months, home builders and remodelers shed 12,600 jobs on a net basis. Since the low point following the Great Recession, residential construction has gained 919,900 positions.
In September, the unemployment rate for construction workers dropped to 8.7% on a seasonally adjusted basis, from 9.9% in August. After hit 16.1% in April due to the impact of the COVID-19 pandemic, the unemployment rate for construction workers has been trending downward for the past five months.
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