November Employment Data

In each Economic Update, the Research staff analyzes recently released economic indicators and addresses what these indicators mean for REALTORS® and their clients. Today’s update discusses November employment data.

  • The good, the bad, and ugly, along with the weird, are all in the latest employment data.
  • Good: net new payroll job addition of 146,000 in November, which brings 12-month tally to 1.9 million. The unemployment rate fell to 7.7 percent, the lowest figure since President Obama was inaugurated in 2009.
  • Bad: jobs count by the household survey fell in November by 122,000. There are two measures of jobs, one based on asking companies how many are working and another based on asking people if they have jobs. Company data showed more jobs, while household data showed fewer jobs.
  • Ugly: the labor force participation rate fell to 63.6 percent of adults either with jobs or looking for work. Those without a job who do not look for work are not counted as unemployed. This labor force participation has fallen precipitously in the past few years. Some adults are attending school, some have taken early retirement packages, and there has been a sudden rise in the number of people making disability claims. None of these groups are working but they are not counted as unemployed.
  • Weird: something is obviously wrong with construction employment data. The data shows fewer construction jobs by 20,000. This does not align with rising housing starts. Both data were seasonally adjusted, so even after accounting for normal seasonal patterns, construction and general contractor job figures and building activity are not jiving.
  • The average hourly wage rose 1.3 percent from one year ago, while the inflation rate rose by 2.2 percent. So the paycheck is not keeping up with living expenses.
  • Despite the mixed results in the latest month, for real estate, what matters is whether there are more people working. By company data, there are now 4.5 million more jobs from the low point in 2010. By household data, there are now 5.3 million more jobs from the low point in 2009.

Lawrence Yun, PhD., Chief Economist and Senior Vice President

Lawrence Yun is Chief Economist and Senior Vice President of Research at NAR. He directs research activity for the association and regularly provides commentary on real estate market trends for its 1 million REALTOR® members.

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