NAHB sees positive signs in employment report

From the NAHB -- September 17, 2010 – Recent employment figures indicate that there still are signs of life in the U.S. economy's recovery. The August Employment Situation report by the Bureau of Labor Statistics confirmed that the U.S. economy is on the mend, albeit slowly.

Indeed, total nonfarm payroll employment was down 54,000, a figure dominated by the loss of 114,000 temporary Census Bureau workers who have completed their work on the decennial census.

But at the same time the public sector was reducing its temporary work force, the private sector added 67,000 workers in August, the eighth consecutive monthly increase. Further, July's private sector increase was revised up 36,000 jobs to 107,000, as was the June increase, from 31,000 initially to 61,000.

The August increase included the addition of 16,800 temporary workers, which following a loss of 900 temporary jobs in July. With the exception of the July setback, temporary worker employment has been on the rise every month starting in October 2009.

The reliance on temporary workers in the private sector at this stage of the recovery indicates that employers are still uncertain about the recovery's strength; in particular, how long a rise in demand for their products and services will last. Temporary workers enable employers to hedge their hiring bets until they are certain that demand is sustainable.

If demand is sustained; as NAHB forecasts; many of the temporary positions in the private sector will become permanent.

Private sector job gains were realized in health care and social assistance (up 40,200) and professional and business services (up 20,000). But job losses in such areas as retail trade (down 4,900) and transportation and warehousing (down 7,400) partially offset the gains.

Employment stability and job growth; keys to housing's recovery; are needed to help boost the confidence of households that are considering buying or renting a home. NAHB continues to forecast slow employment gains for the remainder of the year as economic activity shows modest growth.

With home builders in a holding pattern due to weak housing demand, residential construction jobs fell 9,800 in August, following the loss of 15,400 jobs the month before and the 21,400 jobs lost in August a year ago. The continued decline corresponds with the slowing of single-family housing starts, down for the third consecutive month, and July's sharp drop in housing completions.

On a more positive note, total construction jobs, which include non-residential employment, rose 19,000 in August, the first monthly increase since April. However, the overall unemployment rate for construction rose to 22.5%, up from 20.7% in July.

Loading