Builders and residential contractors added nearly 60,000 jobs in June — about 11,000 more than expected for this time of year, according to data released Friday by the Bureau of Labor Statistics.
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The real estate workforce continued to forge ahead in June, with a particularly strong hiring boom last month in residential construction.
The offices of real estate brokers, agents and property managers added 22,600 jobs between May and June — a 2,000-worker increase after accounting for normal seasonal patterns, according to the U.S. Bureau of Labor Statistics. That 0.1 percent seasonally adjusted increase in brokerage and property manager payrolls is in line with that of the broader U.S. economy, which recorded a seasonally adjusted increase of 209,000 private non-farm jobs.
The increase in jobs nationwide remains high by pre-pandemic standards, but still came in below the 306,000 jobs created the month before.
“The incoming economic data has been filled with conflicting signals,” Mortgage Bankers Association Chief Economist Mike Fratantoni said in a statement. “Manufacturing activity remains quite weak, while consumer spending has held up somewhat better, and new home construction and sales have picked up. Our forecast is for a slowdown in economic activity in the second half of 2023, with a recovery in early 2024. The June employment report reinforces that forecast.”
Over the course of the past year, when transactions were down and home prices fell and rose, brokerage and property manager offices have fallen slightly behind U.S. job growth in other sectors. These real estate employer payrolls were up 2 percent year over year in June, compared to 2.5 percent year-over-year growth for the nation at large.
In residential construction, employers have maintained robust payrolls as demand for newly built homes continue to gain steam in this inventory-depleted market.
Homebuilders and residential trade contractors added 59,800 jobs in the month of May, a number the agency considers more like a 10,800-job bump after accounting for normal seasonal hiring patterns. That’s a 0.3 percent seasonally adjusted monthly increase since May, which triples the rate of job growth seen in other areas of real estate and the broader economy.
The recent hiring spree among builders and contractors also represents a reversal from much of the past year, when residential construction payrolls have risen at a much more conservative pace than those in other sectors. Residential construction employers have built up their workforce by 1.6 percent in the past 12 months, compared to the national mark of 2.5 percent.
As with previous reports, economists and other market observers have been watching the jobs numbers with interest not only for what they say about how the economy is doing, but also for what they might mean for U.S. monetary policy as officials continue to move to keep inflation in check.
Mortgage rates hit new 2023 highs this week on recent releases of strong jobs and economic data that raises the odds that the Federal Reserve will resume hiking rates this month after pausing in June.
“While job growth and wage growth are trending down, both are still well above the pace that would be consistent with the Federal Reserve’s inflation target,” Fratantoni said. “We now expect that the [Fed] will raise the federal funds target another 25 basis points at its July meeting.”