Weekly Economic Review: Job Growth Slows in September, Consumer Optimism Rises

Posted by Laine Smith on 11/12/16 9:00 AM

Topics: Economy

Following this week’s election results, mortgage rates jumped to a 5-month high. While September job openings saw little change, labor market conditions are continuing to show optimism, alongside consumer reports.

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Job openings sluggishly increased to 5.486 million in September from the revised 5.453 million in August, according to the Job Openings and Labor Turnover Survey. Hiring is also slow, falling to 5.081 million from August’s 5.268 million. The falling layoff rate, which dropped 2-tenths to 1.0 percent, signifies that employers are holding onto existing employees due to failed efforts to find other qualified applicants.

The October Labor Market Conditions Index increased to an outsized plus 0.7, making it the third positive reading of the year. The average hourly earnings component was the biggest contributor to the composite increase.

Americans’ self-reports of daily spending averaged $93 in the month of October, up $2 from the previous month. This is among the highest readings of the Gallup US Consumer Spending Measure’s nine-year history.

The consumer credit report was also a signal of consumer optimism in September. Total consumer outstanding credit increased by $19.3 billion in September with revolving credit increasing by $4.2 billion after a jump of $5.6 billion in August.

This week in the economy:

  • The 30-year fixed-rate average jumped again this week, reaching a 5-month high of 3.57%, according to Freddie Mac.
  • In the November 11 week, purchase applications increased a seasonally adjusted 1 percent, according to MBA Mortgage Applications. Refinancing activity continued to lag, falling 3 percent. Year-over-year purchase applications are up 11 percent.
  • Jobless claims in the week of November 5 echoed the JOLTS reports of employers holding onto their existing employees. Initial jobless claims fell 11,000 to 254,000.
  • The Bloomberg Consumer Comfort Index accelerated in the November 6 week. Up half a point to 45.1, the index is over 2016’s trend line of 44 after several weeks of gains.

What’s on economic calendar for the week of November 14, 2016:

  • Tuesday – Retail Sales
  • Wednesday – MBA Mortgage Applications, Housing Market Index
  • Thursday – Jobless Claims, Bloomberg Consumer Comfort Index, Consumer Price Index, Housing Starts

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