In April, the Bureau of Labor Statistics released a very promising jobs report. In March, the economy gained 916,000 jobs, which is well above what the experts projected which was 650,000 to 675,000. In turn the unemployment rate fell to 6%.
What does this statistic mean to you?
Our daily lives are always impacted deeply by the nation’s economy. The better the economy is doing overall, the better most individuals in the country will do as well and vice versa. Below we have listed what four experts told the Wall Street Journal after reviewing the report.
Michael Feroli, JPMorgan Chase:
“The powerful tailwind of the reopening of economic activity appears to be gathering force; while the level of employment last month was still 8.4 million positions below that which prevailed before the pandemic, it is reasonable to expect that a majority of those lost jobs will be recouped in coming months.”
Mike Fratantoni, Mortgage Bankers Association:
“We fully expect that this pace of job gains will continue for months, and anticipate that the unemployment rate, now at 6%, will be well below 5% by the end of the year”
Paul Ashworth, Capital Economics:
“With the vaccination program likely to reach critical mass within the next couple of months and the next round of fiscal stimulus providing a big boost, there is finally real light at the end of the tunnel.”
Jason Schenker, Prestige Economics:
“People are getting back to work and the vaccine isn’t just inoculating the population, it’s clearly inoculating the economy.”
Most importantly, what does this mean for today’s homebuyers?
The biggest challenge for today’s homebuyers is the lack of homes currently for sale. The listing inventory is down 52% from a year ago, bidding wars are through the roof, and home prices are climbing. One solution to this hurdle is to build more homes to please the demand.
The good news: the jobs report projects hope for new housing construction. Below is what three industry economists said about the increase in construction:
“Construction jobs boomed in March, one of the largest monthly gains ever. This raises the prospect for more home building and more inventory reaching the market in the upcoming months. The housing market has been hot with fast rising home prices but has been constrained by a lack of supply. By hiring more workers and building more homes, home prices will move to a manageable level to give more Americans a shot at ownership.”
“Great jobs report for a housing market in an inventory crisis. Residential construction building jobs increased 3.9% from pre-2020 recession peak in Feb. 2020. The construction industry remains a labor-intensive industry. We need more hammers at work to build more homes.”
“Good job numbers in March for residential construction. 37,000 gain from Feb to March. 3.03 million total employment for home builders and remodelers, and up 49,100 from Jan 2020..”
An improving economy with a dwindling unemployment rate means households and the overall housing market are also improving. Now is the time to buy a home whether you are a first-time homebuyer or you’ve bought a home before. Connect with our team today and we can guide you through your next steps to becoming a homeowner.