Construction spending got a shot in the arm, while unemployment was essentially flat, and layoffs stayed at historic lows.
Construction spending during March rose 0.3 percent to hit an annual rate of $1.13 trillion, the Census Bureau reported last week. This marked the highest rate since 2007, and when compared annually, March’s rate was 8 percent higher than March 2015’s rate.
Spending on private construction and home building were big contributors to March’s construction gains. Private construction as a whole grew 1.1 percent to an annual rate of $842.3 billion. Residential construction, in particular, saw a solid performance, growing 1.6 percent in March to hit an annual rate of $435.5 billion in March.
The continued push for more housing inventory should help to keep prices in check, which should in turn help bolster sales volume.
The economy added just 160,000 jobs during April, keeping the unemployment rate unchanged at 5 percent and the number of out-of-work Americans at 7.9 million, the Bureau of Labor Statistic reported last week. Key areas of job growth were professional and business services, healthcare, and financial activities.
The number of long-term unemployed those out of work for 27 weeks or longer — dropped by 150,000 in April to 2.1 million people. The number of Americans involuntarily employed on a part-time basis for reasons such as their hours being cut or that being the only work they could find was essentially unchanged in April at 6 million.
“It’s a soft report but it doesn’t portend a turn in the labor market,” Chief U.S. Economist at Barclays Michael Gapen told the New York Times. “I’d be more concerned if there were weakness across the board, but there wasn’t.”
Initial Jobless Claims
In more recent employment news, first-time claims for unemployment benefits filed by the newly unemployed during the week ending April 30 hit 274,000, a gain of 17,000 from the preceding week’s total of 257,000, according to last week report from the Employment and Training Administration.
This marked the 61st straight week of initial claims below 300,000, a threshold that economists consider indicative of a growing job market — the longest such streak since 1973.
The four-week moving average — considered a more stable read on layoff activity — notched up to 258,000 claims, a 2,000-claim gain from the prior week’s average of 256,000.
This week we can expect:
- Tuesday — Wholesale inventories for March from the Census Bureau.
- Wednesday — Budget for April from the Treasury Department.
- Thursday — Initial jobless claims for last week from the Employment and Training Administration; import and export prices for April from the Census Bureau and the Bureau of Economic Analysis.
Friday — April producer price index from the Bureau of Labor Statistics; April retail sales and March business inventories from the Census Bureau.