This article was originally posted on rdbmagazine.com. Below the article is a reader's response.
Friday, August 5, 2011, the U.S. Bureau of Labor Statistics released its jobs report for the month of July 2011. According to the report, employment rose 117,000 and the unemployment rate dropped from 9.2 percent in June to 9.1 percent. It's important to note the unemployment rate by month over a period of time: March 8.8 percent, April 9.0 percent, May 9.1 percent, June 9.2 percent and July 9.1 percent.
Throughout the year, both the National Association of Home Builders and American Institute of Architects have been vocal about the impact a hurting job market has on a housing market recovery. In June, during the Mid-Year Construction Forecast (http://ow.ly/61I3b), David Crowe, chief economist for NAHB said a job recovery will "lead the country back to normal levels" - not residential construction.
In response to the jobs report Crowe says: "The jobs report today and the slight decline in unemployment are good news for the economy and housing, but real housing improvement needs consistent job gains at 200,000 or more per month. Today’s gain is not enough to make a significant dent in unemployment or in consumers’ confidence that a recovery is here to stay. Prospective home buyers need greater confidence in their own economic future before they can take advantage of the very low interest rates and home prices. A steady and consistent improvement in job gains will encourage home buyers back in the market."
Kermit Baker, chief economist for the American Institute of Architects also responded to the latest job numbers: "The July employment report was not strong enough to provide much support for the housing recovery. The national unemployment rate has been hovering around 9% for several months, which is still very high by historical standards. The 117,000 net increase in payrolls was better than the past two months, but not enough to generate much growth. The sense is that we need to generate about 150,000 per month on average just to keep up with new entrants to the labor force."
Does the July jobs report make you more or less optimistic, or unaffected? Send an email to email@example.com.
Yes it is encouraging to see a better jobs report. But it is not enough to instill any kind of confidence in the American people. Before the American people will look at buying new homes in any kind of volume, our country will have to not only get unemployment down, but our government will have to instill confidence as well. I believe people are so discouraged with government today that even if employment would start to drop, I don't know if that is enough anymore. Unfortunately we have a long painful road ahead of us and politicians who could care less about the American people. We are quickly losing our middle class workforce, which is sad because we are the backbone of this country.
- Tim Marine, AIBD
Building Designs Inc.