Why jobs matter to real estate
For anyone who has read Fred Glick’s articles here on AG or listened to him for more than 30 seconds on CNBC, you know that he has been yelling from the mountaintops that our economy, therefore the real estate sector, will not recover until the employment rate is significantly improved.
How unemployment has changed since 2009
Recently, America has experienced record levels of long-term unemployment. According to the Economic Policy Institute (EPI), “In April, the median length of unemployment in the United States was 21.6 weeks, up from 15.1 weeks in 2009 and well over double the median unemployment spell of 8.4 weeks at the start of the recession in December 2007.”
Job searches took the longest in Michigan and South Carolina (19.4 weeks), followed by Florida (18.1 weeks), and Rhode Island (17.0 weeks) while Alaska, North Dakota, and Wyoming enjoyed the shortest median length of unemployment at roughly eight weeks.
The EPI reminds us that “while the median duration of unemployment represents the typical job search, it also means that the wait is longer for half of all unemployed workers.”
Unemployment and real estate
As people wait to regain employment, so does the real estate industry wait for their transacting. No job means no loan means no real estate transaction, so unemployment is certainly a leading real estate health indicator. With the median length of unemployment on the rise so dramatically, while other signs point to stability in the housing market, this will likely be the biggest obstacle to a full recovery.
