5/14/21: EconUpdate by P. Duffy

EconUpdate by P. Duffy

Initial unemployment claims dip 6.7 percent to lowest level in 14 months

What does this mean? Although initial claims continue to fall, stubbornly high continued claims indicate a slow rebound in the labor markets.

In the week ending May 8, initial unemployment claims were 473,000, a decrease of 34,000, or 6.7 percent, from the previous week’s revised level to the lowest level since March 14, 2020.  Continued claims during the week ending May 1 was 3,655,000, a decrease of 45,000, or 1.2 percent, from the previous week’s revised level. The total number of continued weeks claimed for benefits in all programs for the week ending April 24 was 16,855,264, an increase of 696,152, or 4.3 percent, from the previous week.

https://www.dol.gov/ui/data.pdf

April Producer Price Index up 6.2 percent year-on-year, highest annual increase since late 2020

What does this mean?  More parts of the economy are experiencing higher prices due to shortages in labor and supplies.

The Producer Price Index for final demand increased 0.6 percent in April, down from 1.0 percent in March but up 6.2 percent year-on-year, for the largest advance since 12-month data were first calculated in November 2010. The index for final demand less foods, energy, and trade services rose 0.7 percent in April following an increase of 0.6 percent in March, and was up 4.6 percent, for the largest advance since 12-month data were first calculated in August 2014.

https://www.bls.gov/news.release/ppi.nr0.htm

New Home Lot Supply Index reaches series low in first quarter of 2021

What does this mean? Strong demand due to low interest rates and remote work continue to put pressure on builders finding suitable land for more homes.

The New Home Lot Supply Index (LSI) hit a new low in 1Q21, reaching 49.0. The LSI dropped 10.1 percent from the previous quarter and 24.2 percent year-over-year as builders are buying finished vacant lots as quickly as they are available to help meet today’s homebuying demand.  Los Angeles, San Diego, and Baltimore are the tightest for lot supply among major markets.

https://zondahome.com/new-home-lsi-new-home-lot-inventory-reaches-new-low/