Economists' Outlook

Housing stats and analysis from NAR's research experts.

Employment Situation

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 the employment situation.

  • Yet another month shows good but not great jobs figures. 96,000 net jobs were added to the economy in August according to the Payroll survey and the unemployment rate was down slightly to 8.1 percent according to the Household survey.
  • The labor force shrank as there were declines in the number of both employed and unemployed persons. To be counted as not in the labor force an individual is not seeking work either for school, retirement, family, economic, or other reasons.
  • A shrinking labor force and growing population caused the labor force participation rate to fall yet again. If non-participation is for schooling, an investment in human capital, this is good for the economy, but non-participation for other reasons could lead to skill erosion.
  • The continued growth in jobs is a positive sign for the housing market, but more jobs are needed to make a meaningful dent in the unemployment rate.
  • The long-term trend of falling government jobs continues at the state and local levels while the Federal government added a modest 3,000 jobs in August; the expansion in jobs came from the private sector.
  • While goods-producing industries such as manufacturing and mining saw a small net loss of jobs, service providing industries saw job gains broadly. The Leisure and Hospitality industries added 34,000 jobs, primarily driven by jobs in food services and drinking places. 22,000 Education and Health Care Services jobs were added due mostly to expansion in health care jobs. An additional 28,000 Professional and Business Services jobs were added in spite of a small loss in legal services jobs due to gains in accounting, architecture and engineering, computer services, and consulting jobs. The 29,000 jobs added in Trade, Transportation, and Utilities were broadly distributed, as well.
  • The gains in trade and professional services jobs bode well for commercial real estate. Job gains in warehousing were modest compared with the previous 4 months, but the trend continues in the right direction.

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