Job growth in January started 2016 in modest fashion, adding 151,000 jobs, or 1.9%, year-over-year. It was the 64th consecutive month of gains. This is down from the revised jump of 262,000 in December. Wages posted another strong annual increase, with average hourly earnings growing by 2.5% year-over-year. Last month’s number was revised upwards to 2.7%. As the labor market tightens, we should continue to expect strong gains in wages in 2016. However, while wage growth is good news for households, price and rent increases of 3-4% during the same period have completely offset these wage gains.
On the construction side, job growth from homebuilding activity remains solid, especially from residential trade contractors. The residential construction sector added 29,200 jobs year-over-year, or 4.5% growth, in January. December and January’s numbers were the two largest year-over-year increases since May 2015. Growth in residential specialty trade contractors continues to speed up, growing very strongly with 7.3% year-over-year, and is the fourth straight month of increasing gains. It was the best month since February 2015. This uptick reflects both a solid year for housing starts in 2015 as well as increasing confidence of homebuilders headed into 2016.
Existing Home Sales and Homeownership Highlights:
- Payrolls increased by 151,000 jobs, or 1.9%, year-over-year.
- Average hourly earning increased by 2.5% year-over-year, but renters did not realize these gains because of 3% rent increases during the same period.
- Residential construction payrolls increased by 4.5% year-over-year, breaking a four-month streak of increasing gains.
- Residential specialty trade contractors increased by 7.3% year-over-year, increasing for the fourth straight month.
