At a net of 157,000 new jobs, the rise in employment during January wasn’t particularly strong, but there was other good news in Friday’s Bureau of Labor Statistics report. For one thing, the net increase in payroll employment was revised upward in both November (from 161,000 to a robust net increase of 247,000 jobs) and December (from 155,000 to a nearly robust 196,00 jobs). It’s entirely possible that January’s total will likewise be revised upward, if recent patterns hold.
The BLS also reported that as of January 2013, there were 2.4 million people “marginally attached” to the labor force, down by 366,000 from a year earlier. Marginally attached workers don’t have jobs but want them and are available for work, and looked for a job sometime in the previous 12 months. Because they didn’t look for work in the four weeks before the survey, they aren’t counted as unemployed.
Among the marginally attached, there were 804,000 discouraged workers in January, a decline of 255,000 from a year earlier — also an encouraging movement. Discouraged workers are people not currently looking for work because they believe no jobs are available for them.
Put together all of the marginally attached workers and the unemployed workers who looked for work in the last four years and one gets U-5, an alternate measure of unemployment. U-5 was 9.9 percent in January 2012; a year later, it was 9.3 percent. Add people who are part-time workers but want full-time jobs — which the BLS calls U-6 – and the January 2013 total was 14.4 percent. A year earlier, U-6 was 15.1 percent.
Construction Employment, Spending Up
The improving health of the residential market was partly responsible for an uptick of 28,000 in construction employment in January. Nearly all of the job growth occurred in specialty trade contractors (up by 26,000), with the gain about equally split between residential and nonresidential specialty trade contractors. Since reaching a low in January 2011, construction employment has grown by 296,000, the BLS says, with one-third of that gain occurring in the last four months. Still, the January 2013 level of construction employment is about 2 million below its previous peak level in April 2006.
A rise in construction spending has been concurrent with a rise in construction employment. According to the Census Bureau on Friday, in a separate report from the BLS, total U.S. construction spending rose 0.9 percent in December, to an annualized rate of $885 billion, the highest level since August 2009. For all of 2012 compared with 2011, construction spending was up 9.2 percent, the first annual increase since before the recession (2006).
Spending on homebuilding was up in December by 2.2 percent to an annualized rate of $308.2 billion, the highest level since November 2008, the bureau also reported. Outlays for multi-family construction — which tends to be volatile — spiked 6.2 percent, while single-family construction was up 0.8 percent for the month. All together in 2012, residential construction spending was up a whopping 22.3 percent compared with 2011.
Wall Street had a heady up day on Friday — perhaps because of good economic news, but maybe because when stocks are this highly valued, more investors buy (until it inevitably can go no higher). In any case, the Dow Jones Industrial Average spiked 149.21 points, or 1.08 percent, and the S&P 500 and the Nasdaq were up 1.01 percent and 1.18 percent, respectively. An arbitrary benchmark it may be, but the Dow closed above 14,000 for the first time since 2007, and is within shouting distance of the index’s all-time high of 14,164.53, which occurred on Oct. 9, 2007.
Dee Stribling, Commercial Property Executive.