U.S. unemployment fell to 11.1 percent in June, according to the U.S. Bureau of Labor Statistics. This past month, the economy added 4.8 million jobs—a strong comeback following a decline of 1.3 percent in May’s unemployment figure.
According to the jobs report, gains primarily occurred in the leisure and hospitality sectors; however, several other industries experienced noticeable job increases as well: retail, trade, education, health services, manufacturing and professional and business services.
While unemployment could spike again following reports of states that are continuing to battle a resurgence of COVID-19 cases, industry professionals say consumer confidence remains strong and the real estate markets continue to recover.
The Industry’s Response:
“The country is undergoing extraordinary times and extraordinary movement is happening in the jobs data. The near 5 million job additions in a single month in June is off-the-chart, the best ever by a wide margin, and comes on top of 2.7 million job gains in the prior month. However, much more needs to occur to overcome the 20 million job losses in April. Movement in the right direction is very encouraging nevertheless. The housing market is clearly in a V-shaped recovery and more home construction jobs need to be added. Commercial real estate, however, will lag far behind, especially for office and retail sectors.” — Lawrence Yun, National Association of REALTORS® Chief Economist Lawrence
“The job market recovered at a much faster than anticipated pace in June, with strong job growth and a surprisingly large drop in the unemployment rate; 7.5 million people returned to work in May and June following a temporary layoff, which is quite a rebound. However, there are still 10.6 million people with this status, and the longer they remain out of work, the greater the risk that their situation becomes permanent. We are also continuing to see a very high level of new layoffs, with 1.4 million initial claims for unemployment insurance last week. The job gains in June were very broad-based: manufacturing, construction, professional services, retail trade, leisure and hospitality, and health care all saw large gains.
“This report is nothing but positive for the housing and mortgage markets. The stronger job market will support new home purchases, as well as helping homeowners make their mortgage payments. MBA continues to believe that Congress needs to extend enhanced unemployment insurance benefits to support those households that remain unemployed. Although this surprisingly strong report will put some upward pressure on interest rates, we do not expect it will change the Fed’s commitment to keep rates at zero for the foreseeable future.” — Mike Fratantoni, SVP and Chief Economist, Mortgage Bankers Association