The January 2020 jobs report released on Friday actually represented the first major data of the new year and new decade. It also came just about one week after our first look at economic growth for the fourth quarter. The preliminary 2.1% growth rate was seen as right on target. Adding 225,000 jobs in January was consistent with this moderate picture of economic growth.
As we look deeper into these numbers, we can see that the previous two months were reported to be revised upward; however, an annual revision brought the total jobs added for 2019 down slightly. Plus, the headline unemployment rate came in at 3.6%, still near historic lows and actually good news because more Americans entered the labor force. Wage growth was reported 3.1% on an annual basis, which means that inflation should remain tame. All in all, the report was seen as good news as moderate growth continues without inflation.
Even though the picture has been pretty steady, we can see that the numbers can change quite rapidly. Already in the past several weeks, we have had escalated tensions in the Middle East and the growing virus scare. The markets have been very volatile as a result, which is not unusual. This has caused interest rates to fall at the beginning of the year. While the travel industry will certainly take a hit with the coronavirus, lower rates will continue to support the real estate markets.
Dave Hershman is the top author in the mortgage industry. Dave has published seven books, as well as hundreds of articles and is the founder of the OriginationPro Marketing System and Mortgage School. Want to send this commentary and other news in a personalized format to your sphere database or on social media? Sign up for a free trial at www.OriginationPro.com.