Aside from 16-year low unemployment, monthly jobs data indicate weak labor conditions — driving down rates. But staffing expanded in the mortgage industry.
Data reported Friday by the Census Bureau indicate that the U.S. unemployment rate was 4.3 percent in May —
the lowest it’s been since May 2001.
Unemployment stood at 4.4 percent as of one month previous, according to the BLS, while it came in at 4.7 percent as of
the same month last year.
But despite the favorable unemployment metric, an anemic 138,000 nonfarm payroll jobs were added last month. Job growth fell from an already weak and downwardly revised 174,000 in April but was up from a lethargic and upwardly revised 43,000 jobs added in May 2016.
The labor participation rate slipped to 62.7 percent from 62.9 percent the previous month.
National Association of Federally Insured Credit Unions Chief Economist Curt Long commented in a written statement that job growth was short of expectations, while prior months’ job growth was revised down, and wage growth was stagnant.
“Despite the poor May returns, the Fed’s view of the labor market remains strong enough to support a quarter-point rate hike later this month,” Long stated. “But the slowing pace of job growth combined with still-muted wage growth may lead some officials to downgrade their expectations for further policy tightening in the second half of the year.”
The bad news for the jobs report was good news for mortgages rates; in early morning trading, investors drove down the 10-year Treasury yield by 5 basis points — placing downward pressure on mortgage rates.
In the home lending business, which the BLS reports on a one-month lag, there were 334,200 non-bank jobs as of April. Mortgage jobs expanded from a downwardly revised 333,300 the prior month and an upwardly revised 309,900 a year prior.
The April 2017 mortgage total included 239,200 jobs classified as “real estate credit” and 95,000
“mortgage and nonmortgage loan brokers.”
Based on a Mortgage Daily analysis of the BLS data and origination market share data, estimated total mortgage headcount — including jobs at financial institutions — amounted to 741,500 as of the most-recent month. The total was comprised of 338,800 mortgage jobs at banks, 68,600 positions at credit unions and the 334,200 non-bank jobs reported by the BLS.
