Kansas City’s unemployment rate edged up from 8.3 percent to 8.5 percent in between May and June. This is still better than the 8.9 percent rate we had one year ago.
We typically see a boost in employment and labor force during the summer months as students are looking for work. This is clearly the case this summer, as the labor force (the number of people who are employed or are actively looking for work) increased by nearly 11,500. Employment also increased, but by less than 9,000, thus leading to a higher unemployment rate.
Historically, June is the high point of the year for employment rates because of seasonal summer jobs. Hopefully that will not be the case this year. If the economic recovery gains some traction and we begin to see some real employment increases we can look forward to higher employment levels in the months to come.
Friday, July 30, 2010
Friday, July 2, 2010
May Unemployment Rates Released
As much as we want the recession to be over and to be on a solid road to recovery, the sad fact is we are still a ways away from a strong economy, at least in terms of employment. Sure, April gave us reason to hope when the regional unemployment rate dropped from 9.3 percent to 8.3 percent. The number of people who were unemployed dropped by nearly 10,000 and actual number of people working climbed by nearly 12,000.
May’s numbers were released this week, and they were not bad, but they were not particularly good either. All variables (Labor Force, Employment, Unemployment and Unemployment Rate) leveled off instead of showing continued signs of improvement. The labor force increased by 213, unemployment decreased by 714, while employment grew by just 927. The unemployment rate remained unchanged at 8.3 percent.
Adding to this lackluster news is today’s release of the national employment numbers for June (remember the state and local figures will lag the national) indicating a net loss of 125,000 jobs. The loss of 225,000 temporary census jobs is largely to blame for the net decline. Were it not for the loss of these census jobs, the country would have added roughly 100,000 jobs. The bulk of these jobs (83,000) were in the private sector, but economy-wide, this increase barely makes a dent.
May’s numbers were released this week, and they were not bad, but they were not particularly good either. All variables (Labor Force, Employment, Unemployment and Unemployment Rate) leveled off instead of showing continued signs of improvement. The labor force increased by 213, unemployment decreased by 714, while employment grew by just 927. The unemployment rate remained unchanged at 8.3 percent.
Adding to this lackluster news is today’s release of the national employment numbers for June (remember the state and local figures will lag the national) indicating a net loss of 125,000 jobs. The loss of 225,000 temporary census jobs is largely to blame for the net decline. Were it not for the loss of these census jobs, the country would have added roughly 100,000 jobs. The bulk of these jobs (83,000) were in the private sector, but economy-wide, this increase barely makes a dent.
Friday, May 21, 2010
April Home Sales Figures are Strong
The Kansas City Regional Association of Realtors released its April home sales figures this week, and there is reason for cautious optimism. April saw 2,644 home sales, an increase of 672 from April 2009. Even more encouraging is the fact that these homes’ average selling price was up by more than $5,000 from one year ago.
Additional good news is that the overall housing inventory has leveled off at around 16,500 homes. There were actually fewer homes for sale in April 2010 than April 2009. On average, it takes 7.4 months for a home to sell in the Kansas City area, down from eight months one year ago.
Overall, this is all good news so why the cautious optimism? Undoubtedly the ending of the Housing Tax Credit in April spurred much of the activity last month. It is likely that many potential homebuyers made their purchases in April to beat the deadline, so we might see that sales are down in May and June because so many buyers already jumped into the market. May’s figures will be very telling. If sales plummet, we can assume April was an anomaly caused by the tax credit. However, if sales remain strong, we might be seeing the beginnings of the housing market recovery that the economy has been yearning for since 2008.
Additional good news is that the overall housing inventory has leveled off at around 16,500 homes. There were actually fewer homes for sale in April 2010 than April 2009. On average, it takes 7.4 months for a home to sell in the Kansas City area, down from eight months one year ago.
Overall, this is all good news so why the cautious optimism? Undoubtedly the ending of the Housing Tax Credit in April spurred much of the activity last month. It is likely that many potential homebuyers made their purchases in April to beat the deadline, so we might see that sales are down in May and June because so many buyers already jumped into the market. May’s figures will be very telling. If sales plummet, we can assume April was an anomaly caused by the tax credit. However, if sales remain strong, we might be seeing the beginnings of the housing market recovery that the economy has been yearning for since 2008.
Monday, May 17, 2010
Random Economic News
There are a couple of positive economic notes in today’s news. RealtyTrac reports that nationwide foreclosures dropped 9 percent in March and an additional 2 percent in April compared to the previous month. Now that we are a good three years into the housing crisis, it would appear that foreclosures may have finally reached their peak and we will see foreclosure numbers continue to decline.
The negative effect of foreclosed properties on all surrounding properties is well documented. While this negative impact should begin to slowly mitigate as foreclosure numbers drop, it is still far too early to declare victory over the housing crisis. An estimated 25 percent of all homeowners still owe more on their homes than they are worth. It will likely take years before the housing market gets back to some semblance of normalcy — and before homeowners can once again feel their home is a valuable asset and not a net negative to their financial well being.
On the employment side, first time unemployment filings declined again for the fourth straight week. This news comes on the heels of a solid April job growth number of 290,000.
These are not giant leaps ahead for the economy, but they can be looked at as baby steps in the right direction.
http://money.cnn.com/2010/05/13/real_estate/april_foreclosures/index.htm?hpt=T2
http://money.cnn.com/2010/05/13/news/economy/initial_claims/index.htm
The negative effect of foreclosed properties on all surrounding properties is well documented. While this negative impact should begin to slowly mitigate as foreclosure numbers drop, it is still far too early to declare victory over the housing crisis. An estimated 25 percent of all homeowners still owe more on their homes than they are worth. It will likely take years before the housing market gets back to some semblance of normalcy — and before homeowners can once again feel their home is a valuable asset and not a net negative to their financial well being.
On the employment side, first time unemployment filings declined again for the fourth straight week. This news comes on the heels of a solid April job growth number of 290,000.
These are not giant leaps ahead for the economy, but they can be looked at as baby steps in the right direction.
http://money.cnn.com/2010/05/13/real_estate/april_foreclosures/index.htm?hpt=T2
http://money.cnn.com/2010/05/13/news/economy/initial_claims/index.htm
Wednesday, April 28, 2010
March Unemployment Figures Released
Several signals in recent months have indicated that we are well on our way to economic recovery. Unfortunately we can’t include March’s employment data in that group. The Kansas City metro’s unemployment rate increased in March to 9.3 percent. This is an increase from 9.1 percent last month and 8.4 percent one year ago. The labor force (the count of all people who are either employed, or unemployed and are actively looking for work) declined to 1,025,298, the lowest figure since June of 2006. Meanwhile employment (the number of people who are employed) dropped to 930,131 — its lowest point since September 1996!
We can’t say these figures are a complete surprise. Employment is a lagging indicator, so we will not likely see employment growth until the recovery is deemed to be strong and sustainable. However, the fact that we have to go back to 1996 to see local employment at the same level we have today is still startling. These numbers really speak to the magnitude of the 2008-09 recession. Yes, we believe we are on our way to economic recovery, but it is certainly going to take a while, especially on the employment front.
We can’t say these figures are a complete surprise. Employment is a lagging indicator, so we will not likely see employment growth until the recovery is deemed to be strong and sustainable. However, the fact that we have to go back to 1996 to see local employment at the same level we have today is still startling. These numbers really speak to the magnitude of the 2008-09 recession. Yes, we believe we are on our way to economic recovery, but it is certainly going to take a while, especially on the employment front.
Wednesday, April 21, 2010
$136 Million Investment in Fairfax Plant Announced
General Motors CEO Edward Whitacre announced today that GM will be paying back the government loan it received last year four years ahead of schedule. Whitacre said much has changed at GM in the past year, and these changes have allowed them pay back the government and look forward to a brighter future.
This was certainly good economic news in itself, but the best news, at least for the Kansas City area, was Whitacre’s announcement that GM will invest $136 million in the Fairfax plant to make the next-generation Chevy Malibu. This investment will make Fairfax the primary manufacturer of the Malibu.
We have written much about the local auto manufacturing sector in this blog. Despite the severe downturn in this sector, Kansas City’s auto manufacturers have not only survived, but thrived. Last year, Fairfax added a third shift when there was speculation that it might lose jobs. The Claycomo plant continues to make two very popular models in Ford’s line. Now with news of today’s GM investment, we can say that auto manufacturing in Kansas City is one of the region’s economic bright spots.
This was certainly good economic news in itself, but the best news, at least for the Kansas City area, was Whitacre’s announcement that GM will invest $136 million in the Fairfax plant to make the next-generation Chevy Malibu. This investment will make Fairfax the primary manufacturer of the Malibu.
We have written much about the local auto manufacturing sector in this blog. Despite the severe downturn in this sector, Kansas City’s auto manufacturers have not only survived, but thrived. Last year, Fairfax added a third shift when there was speculation that it might lose jobs. The Claycomo plant continues to make two very popular models in Ford’s line. Now with news of today’s GM investment, we can say that auto manufacturing in Kansas City is one of the region’s economic bright spots.
Friday, April 2, 2010
Positive Economic News This Week
After two years of mostly dire economic news, three positive economic items released this week almost seems like an embarrassment of riches.
On Tuesday, the Conference Board announced that consumer confidence rebounded from a surprising dip in February. March’s index figure was 52.5, up from 46.4 in February. Consumer confidence had been increasing steadily between October 2009 and January 2010 before February’s drop.
Thursday’s bit of good news was a positive manufacturing report. The Institute for Supply Management’s manufacturing index rose for the eighth straight month in February. This index is based on a survey of purchasing managers and is seen as a reliable measure of manufacturers’ confidence in the economy.
And today, the Labor Department announced that the national economy added 162,000 jobs in March, the largest increase in three years. It is worth noting that an estimated 48,000 of those jobs are temporary Census jobs; still, the other 100,000-plus jobs will mark an end to the continuous job losses we experienced in 2008 and 2009. These new jobs did not lower the unemployment rate. It stands at 9.7 percent for the third straight month.
We will get updated employment data for the Kansas City area next week, on April 7, when February’s local data is released. March’s data will be released on April 28.
On Tuesday, the Conference Board announced that consumer confidence rebounded from a surprising dip in February. March’s index figure was 52.5, up from 46.4 in February. Consumer confidence had been increasing steadily between October 2009 and January 2010 before February’s drop.
Thursday’s bit of good news was a positive manufacturing report. The Institute for Supply Management’s manufacturing index rose for the eighth straight month in February. This index is based on a survey of purchasing managers and is seen as a reliable measure of manufacturers’ confidence in the economy.
And today, the Labor Department announced that the national economy added 162,000 jobs in March, the largest increase in three years. It is worth noting that an estimated 48,000 of those jobs are temporary Census jobs; still, the other 100,000-plus jobs will mark an end to the continuous job losses we experienced in 2008 and 2009. These new jobs did not lower the unemployment rate. It stands at 9.7 percent for the third straight month.
We will get updated employment data for the Kansas City area next week, on April 7, when February’s local data is released. March’s data will be released on April 28.
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