By: Fred Arnold
It has been quite some time since we have had a week of so much positive economic news coming out in such a short period of time. From housing, to employment, to manufacturing, to construction spending…they are all improving at a rate faster than almost anyone expected.
Although this is only a report for one month, there definitely seems to be signs of an improving trend in many areas which bodes well for the future.
The biggest news of the week came out on Thursday morning from the labor department. National unemployment declined from 6.3 percent down to 6.1 percent. The two most dramatic aspects of the report are that the decline in the rate was due to more people being employed versus people dropping out of the workforce.
In the past most of the improvement in the employment rate has been due more to people giving up on trying to find a job than people getting hired.
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The second positive aspect of the report is that the labor department reported that private sector payroll jumped 288,000 in the month of June which is far more than any analysts expected. The employment numbers for May and April were also revised significantly higher up to 224,000 and 304,000 respectively. News of the improving employment picture shot the DOW above 17,000 for the first time.
Related: Santa Clarita Real Estate Report
The first time jobless claims report for the week ending 6/28 also showed signs of a healthy job market with claims coming in at 315,000. This is basically flat from the previous week’s report. Continuing claims are also trending downward which coincides with the improvement in the labor department report.
In April existing home sales showed life. Even more life may be showing in the coming months of June and July based upon May’s stronger than expected increase of 6.1 percent. This is the largest increase since the housing stimulus efforts of April 2010.
Growth in all regions of the United States occurred with the Northeast being the strongest. The West was second which is in stark contrast to what has been occurring recently in which the West has been the weakest area for growth for the last few months. Today’s report is the 3rd straight month of gains which is the longest positive stretch we have seen since the same time last year.
Finally, the ISM Manufacturing Index also showed a strong gain of 2.0 percent further indicating that the economy is continuing to recover. Manufacturing is a key component to measuring the future of health of the economy. When more companies place orders, manufacturing increases which is a great indicator on the expectations of economic growth in the coming months.
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Next week’s market moving reports are on the light side:
* Wednesday July 8th – MBA Applications and FOMC Minutes
* Thursday July 9th – First Time Jobless Claims
As your mortgage professional, I am happy to assist you with any information you may need regarding mortgage or real estate trends. I welcome the opportunity to serve you in any way I possibly can. Please feel free to reach me at 661-505-4300.
Source: Santa Clarita News