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As 2019 got underway, weakness in the housing market drove the number of workers employed by nondepository mortgage companies down by 4,900 to a low not seen since August 2016.
Nonbank mortgage bankers and brokers employed 323,500 workers in January, compared to a downwardly revised 328,400 the previous month and 323,500 one year earlier. In August 2016, when industry hiring was last this low, nonbank mortgage companies employed 321,300 workers, according to the Bureau of Labor Statistics.
Hiring by nonbank mortgage companies has been at 2016 levels since late last year due to a long run of higher rates and thinner margins in 2018. Due to seasonal weakness, mortgage payrolls got even smaller in January despite a slight boost to the business from a dip in rates.
Industry-specific employment is available from the BLS one month after national estimates for overall employment are released. The most-recent estimate for total U.S. jobs, which reflects employment in February, showed there were 20,000 people added to payrolls during the month. That marks the weakest gain in month-to-month jobs since September 2017. But unemployment decreased to 3.8% in February from 4% the previous month.
“Job growth unexpectedly dropped in February, including a decline in construction jobs. However, some of this decrease may be a result of the bad weather,” Mike Fratantoni, senior vice president and chief economist at the Mortgage Bankers Association, said in a press release.
“The decline in the unemployment rate and the further increase in wage growth show a job market that is still quite strong, even if we may be near the top of the current economic cycle.”