November Jobs Report Released

We had a pretty interesting two weeks leading up to the release of the jobs report. Not only did we have a major holiday, but we had some significant data releases. Plus we had a meeting of major oil producers (OPEC) while oil prices were reaching their lowest levels in the past five years. It was a surprise to some that OPEC kept production levels the same in the face of these lower prices, but other analysts had predicted this because OPEC is not wielding the same pricing power as they did in the previous decades.

What does the price of oil have to do with jobs? In the short run, energy prices are not as important as the effect of the severe weather we had experienced in November. But in the long run, if the price of energy stays low this helps the economy. The more consumers can spend this Holiday Season, the more jobs will be created -- and when people spend less on gas they have more to spend on other purchases.

The employment report showed that our severe November weather was not a factor in hampering the economy. The strong gain in jobs of over 300,000 continued a year in which the economy has added well over 200,000 jobs on a monthly basis. Right now we have a good chance to add the most number of jobs annually since 1999. To this news, we can add that car sales had their best month in a decade and the service sector expanded at its highest rate in nine years. All-in-all it was a strong week for economic data. One would expect that shortly this success will start showing up in the form of higher real estate sales. We could experience a strong spring real estate market.

Mike Ervin
Branch Manager/Mortgage Banker
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