MetroIntelligence Economic Update by P. DUFFY
Initial unemployment claims dip to 1.2 million, continued claims fall to 16.1 million
In the week ending August 1, initial unemployment claims were 1,186,000, a decrease of 249,000 from the previous week’s revised level. Continued unemployment claims during the week ending July 25 were 16,107,000, a decrease of 844,000 from the previous week’s revised level.
Consumer confidence by state shows that controlling virus is essential
Consumer confidence fell in 41 of the 50 states from July 1 through Aug. 1. The largest monthly declines occurred in the South and West, regions where the number of new daily coronavirus cases rose most in July. However, over the past three months, confidence has actually increased in New York so that it now has the third smallest decrease in confidence across the country. This rebound in confidence provides a path for other states struggling to reinvigorate their economies. States have to control the virus before they can expect consumer confidence to rebound.
4.8 million jobs available in late July, unchanged from late June
The economic recovery is progressing in fits and starts as the country grapples with resurgent COVID-19 outbreaks. Glassdoor’s latest Job Market Report shows that, as of July 27, 4.8 million job openings are available, unchanged from the prior week and from the prior peak reached in late June. Job openings appeared to be on the path to recovery in early June, but resurgent outbreaks of COVID-19 in July tapped the brakes on the economy, halting the rapid pace of recovery and stalling economic gains.
July economic output growth differed widely by industry
July data signalled growth in four of the seven broad categories of activity, with the mixed picture reflecting the uneven impact of the coronavirus 2019 (COVID-19) pandemic on different industry sectors. Once again, the strongest rate of expansion was seen in healthcare activity, which includes both service provision and the manufacturing supply chain. Beyond healthcare, the recovery in private sector output was led by consumer goods production, followed closely by basic materials. Business activity was broadly unchanged across the industrials category, while technology firms indicated a modest decline in output levels during the latest survey period. Finally, consumer services was unsurprisingly the weakest performing area of the private sector economy in July, reflecting challenges with reopening business operations.
Mortgage credit availability index edges up 1.5 percent in July, down over 30 percent year-on-year
Credit availability rose 1.5 percent in July to 126.9 – the first increase in eight months – as the supply of certain types of adjustable rate mortgages (ARMs) and jumbo loans increased. The improvement was more of a leveling off from the precipitous drop earlier this spring. Still, credit availability is over 30 percent lower than a year ago and near its lowest level since 2014. The July data signals that lenders saw conditions improve this summer, as forbearance requests flattened, and record-low mortgage rates spurred strong levels of purchase and refinance activity.