A drastic decline in job growth was reported by the government. But the news was good for the mortgage industry — with employment expanding and rates tumbling.
U.S. nonfarm payroll employment was up a meager 38,000 jobs during May, according to data that was reported Friday by the Bureau of Labor Statistics.
Job growth plunged compared to a month earlier, when employment was up a weak 123,000 — and that number was revised down from 160,000 originally reported.
Labor market growth collapsed compared to a year earlier, when a
stunning 273,000 jobs were added. The May 2015 number was revised down from 280,000 originally reported.
The BLS, which is part of the Department of Labor,
reported that the unemployment rate fell to 4.7 percent from 5.0 percent in April and 5.5 percent in May 2015.
The last time the unemployment rate was this low was in November 2007.
“This was an unqualified dud of a jobs report, with the weakest month of job gains since 2010,” National Association of Federal Credit Unions Chief Economist Curt Long said in a written statement. “The unemployment rate fell, but for the wrong reason as labor force participation declined for the second consecutive month.
“As for the Fed, this likely puts an end to the hopes of a rate hike in June, and will probably shift market expectations to September.”
The market immediately reacted, with the price of the 10-year Treasury note surging 25/32, while the yield — which moves in the opposite direction — plunged to 1.71 percent from 1.81 percent at yesterday’s close.
Data from the BLS on the mortgage industry, which is reported on a one-month lag, indicate that there were
301,400 people employed in non-bank mortgage jobs during April 2016.
Home-lending jobs increased from an upwardly revised 298,500 a month earlier.
Headcount in real estate finance also expanded from a year earlier, when there were an upwardly revised 287,900 non-bank mortgage jobs.
A Mortgage Daily analysis that factors in BLS data and origination market share indicates that, including mortgage jobs at financial institutions, there were around 627,300 people working in the mortgage industry during the most-recent month.
Estimated mortgage jobs grew from approximately 621,300 in March and
roughly 611,600 in April 2015.
April 2016 mortgage total was comprised of an estimated 262,100 people at banks, 63,800 mortgage employees at credit unions and the 301,400 jobs at non-banks reported by the BLS.