According to the June 2018 job report released by the Bureau of Labor Statistics the United States has added 213,000 jobs. The total is actually larger than the 200,000 jobs economists had originally projected. Overall, job growth was identified in professional and business services, manufacturing, and health care – and the unemployment rate rose to 4 percent.
The continued growth is instrumental for development and the real estate market as a whole. The Labor Department’s findings report that construction employment continued to trend up in June by 13,000 and has increased by 282,000 over the year. “Progressive growth is imperative for the real estate industry,” said Zeitlin & Co. Real Estate Agent, Stefanie Tucker. “I have over 30 years of realtor experience and have professionally witnessed a recession where some of my clients lost their homes, a booming job industry that increased the home buying market tremendously, and experienced a steady market where employment and house purchases remained stable. I’ve found the growth, like we’re experiencing in today’s market, steady and stable, is the best.”
The June 2018 report also highlights the hours and salary increases. The average hourly earnings for all employees on private nonfarm payrolls rose by five cents to $26.98 – making the yearly average hourly earnings increase total 72 cents or 2.7 percent. For the private sector production and nonsupervisory employees, there was an increase of four cents which totals an average of $22.62 an hour. In addition, the average work week for all employees on private nonfarm payrolls remained 34.5 hours. For the manufacturing industry, the work week increased by .1 hour which totals 40.9 hours.
Overall, the numbers represent a stable employment increase. While salaries are increasing at a modest rate, this insinuates that the economy is not increasing at an uncontrollable pace. If consumers continue to receive raises to compensate for inflation and jobs continue to rise, development and expansion will continue.
For real estate investors, entrepreneurs and construction developers the June 2018 findings are favorable. “Growth is always a positive, but steady growth is even better for the economy as a whole,” said Tucker. “As a real estate agent, I monitor jobs and labor reports because it provides me with research for selling goals to reach and also allows me to speak to real estate trends and development when I’m consulting with my commercial real estate clients.”
Chief Economist Mike Fratantoni at the Mortgage Bankers Association shared his thoughts on growth earlier this year with CNBC – and his insight is proving to be true. “There’s just going to be this wave of housing demand hitting the economy over the next four to five years. And we think it’s going to bolster steady growth over that time period.” The housing market is being sought by the millennial generation because they are beginning to reach the first-time homebuying age. According to Fratantoni, mortgage rates are “a bit of a headwind”; however, he believes the demand for housing will not be problematic for the business or economy.
Employment stats correlate directly with real estate investments, developers and construction efforts – and the June 2018 numbers confirm these markets are in a good place now and can make positive projections for the future. If workers are continuing to make a steady income, that aligns with the cost of living, this will translate to continued growth.