On Friday the Bureau of Labor Statistics released very encouraging numbers on the jobs front. According to reports, 288,000 non-farm jobs have been added in the month of April exceeding the previously anticipated 210,000 jobs. This surge in numbers now indicating that so many Americans are now heading back to work as the national unemployment rate dropped to 6.3 percent from 6.7 percent in March, the lowest number since 2008 at the start of the great recession.
In a breakdown of the industries seeking employees, the private sector reportedly added 273,000 new positions with 35,000 jobs coming out of the retail industry and 35,000 being hired in construction. Reports indicate that the government sector is looking to fill about 15,000 jobs. While jobs were being added however, unemployment claims did climbed to a two month peak at 334,000, increasing for the third straight week.
These newly released employment numbers mean that for the many American who have been struggling to find steady work will now be able to contribute to the economy with their new-found spending power. Analysts report that consumer confidence performed at its best since 2009 as spending rose in March by 0.9 percent.
Economists are saying that the vicious winter months had been a big factor in the hiring slowdown of the past quarter. With the welcoming of the warmer weather, construction projects are likely to pick up and many American’s will be looking to hit the shopping malls spending the money they have made from their new jobs. The Commerce Department has reported that the nations gross domestic product grew at a pace of 0.1% in the first three months of 2014 further proving that the U.S. economy is stabilizing.
As those with new jobs may now have reason to get out of bed in the morning heading back to work, those who have been consistently employed throughout the fickle job market have seen little to no surge of an increase in their wages. Many workers are finding their workweek numbers remain leveled at 34.5 hours and salaries have not budged north of the $24.31 average hourly wages for private sector workers.
With the surge in jobs, many with an eye on the housing market are being cautioned that while Wall Street shines a positive light on American’s heading back to work, such news may not be so happy for the housing market. Home sales continue to be slowed to 7.5 percent compared to the year before. Analysts are cautioning that home interest rates could climb and stifle the housing market as 10 year treasury notes are generally tracked by mortgage rates that have been chugging along at numbers around 3 percent. Those now with jobs and seeking to purchase a home may find it a challenge to lock the best rate as lenders continue to tighten generous credit for home buyers.
For the economy to truly take itself to the next level, those with their fingers on the pulse of Wall Street would ultimately like to see both the housing market and the employment numbers surge in tandem. Analysts say that as many of those with new-found jobs are now heading back to work, it would be really nice for those hard workers to have a place of their own to come home to.
By Hal Banfield