According to the research recently released by Trulia, despite the weak cycle between the housing and labor market, the latter has been helping boost the housing recovery.
Based on the October report, the percentage (76.2 percent) of 25 to 34-year-old employed individuals is still below the pre-housing bubble rate (78 to 80 percent) but remains to be the highest since 2008. Trulia believes that this is good news for the housing market since 25 to 34 is the key age range for household formation. The 2014 Census data showed that being employed at such age group made a huge impact in the housing market with only 12 percent living with their parents compared to 21 percent of those unemployed individuals belonging in the same age group.
It was recently announced by the Bureau of Labor Statistics that the overall U.S. unemployment rate has reached it six-year low last month.
Furthermore, another important factor to housing recovery is the surge in employment opportunities in “clobbered metros,” which are areas that were hit badly during the housing bust. Reports showed that job growth had a 2.0 percent year-over-year increase last September, which is slightly higher than the national rate of 1.9 percent within the same period. The clobbered metros with the highest job growth last September were as follows: Orlando (3.7 percent), Miami (3.4 percent), Jacksonville (3.3 percent), and Las Vegas (2.8 percent). Overall, out of the 100 metros, clobbered or not, the highest job growth rate was Houston with 4.3 percent while Columbus, Ohio was the lowest with 0.7 percent.
According to Trulia, the residential construction employment, used as an indicator whether the jobs were helping the housing market, experienced their lowest monthly gain last month at 8,000 jobs since May 2014. As for the residential construction job growth year-over-year, it showed a rate of 6.0 percent, which is definitely way ahead the overall national job growth rate (1.9 percent) for that period.
Although it may seem that the growth rate is too slow compared to the 19.5 percent increase in the number of units under construction reported for September, further examination would reveal that the employment growth rate in residential construction is high relative to construction activity.