Nonbank mortgage hiring rises to a high for the year
Employment estimates for nonbank mortgage companies rose to a 2019 high as lower rates spurred consumer demand in August, but higher rates in September could mean future numbers will be weaker.
Nondepositories in the mortgage business added 1,800 employees to their payrolls in August, according to the Bureau of Labor Statistics. That makes August the strongest hiring month this year, even when accounting for upward revisions to the previous two months' numbers.
But while nonbank mortgage broker and banker employment was at its peak for 2018 in August at 328,800, it's still not as strong as it was a year ago. In September 2018, nondepository mortgage company employment was 10,900 higher than during the same month this year.
The broader job market, for which the BLS reports estimates one month sooner, added 136,000 jobs in September. That number was down from an upwardly revised 168,000 in August and 166,000 in July, but up from a year ago, when 108,000 jobs were added.
The overall unemployment rate in September fell to 3.5% after three months of holding steady at 3.7%. That marks the lowest unemployment rate since December 1969. Last September, the unemployment rate was 3.8%.
"The household survey was generally positive, with the unemployment rate falling to the lowest level in nearly five decades and the labor force participation holding steady," said Fannie Mae Chief Economist Doug Duncan. "However some of the underlying details paint a mixed picture.
"Manufacturing employment declined this month, and after the prior two months' weak gains, the third quarter posted the smaller manufacturing payroll gain in three years as firms may be exercising continuing caution in the face of global uncertainties.
"Additionally, while wages continued to grow close to 3% year-over-year, September's number decelerated to the slowest pace of the year."
The news was also mixed when it came to job growth in another housing-related segment, Duncan noted.
"Residential construction employment (including specialty trade contractors) increased by 3,400, a relatively weak gain considering the positive housing data we have seen so far in the third quarter," he said.
"The report does little to clarify the divergent views on the Federal Reserve about whether the economy is slowing or not, but we continue to believe the Fed will cut rates this quarter due to trade uncertainties and weak manufacturing data," Duncan added.