September job openings, wholesale sales, and Mortgage Monitor

it’s been an unusually uneventful week; the only agency reports released this week were the Job Openings and Labor Turnover Survey (JOLTS) for September from the Bureau of Labor Statistics, the September report on Wholesale Trade, Sales and Inventories from the Census Bureau, and the Consumer Credit Report for September from the Fed…the later showed that overall consumer credit, a measure of non-real estate debt, expanded by a seasonally adjusted $19.3 billion, or at a 6.3% annual rate, as non-revolving credit expanded at a 6.7% rate to $2,728.0 billion and revolving credit outstanding rose at a 5.8% rate to $978.8 billion….for more details on that report, including 5 graphs, see Robert Oak’s post at the Economic Populist: Consumer Credit Increases By $19.3 Billion… this week also saw the release of the Mortgage Monitor for September (pdf) Black Knight Financial Services, which we’ll briefly review today…

Job Openings Increase in September; Hiring and Firing Fall

the Job Openings and Labor Turnover Survey (JOLTS) report for September from the Bureau of Labor Statistics estimated that seasonally adjusted job openings increased by 33,000, from 5,453,000 in August to 5,486,000 in September, after August job openings were revised 10,000 lower, from 5,443,000 to 5,453,000…September’s jobs openings were 2.3% higher than the 5,360,000 job openings reported in September a year ago, as the job opening ratio expressed as a percentage of the employed rose from 3.6% in August to 3.7% in September, which was also up from 3.6% a year ago…all of the September increase in openings can be accounted for by the 33,000 job opening increase to 1,055,000 openings in the broad professional and business services sector, while the leisure and hospitality sector saw openings by decrease 48,000 to 701,000 (see table 1 for more details)…like most BLS releases, the press release for this report is easy to understand and also refers us to the associated table for the data cited, which are linked at the end of the release…

the JOLTS release also reports on labor turnover, which consists of hires and job separations, which in turn is further divided into layoffs and discharges, those who quit, and ‘other separations’, which includes retirements and deaths….in September, seasonally adjusted new hires totaled 5,081,000, down by 187,000 from the revised 5,268,000 who were hired or rehired in August, as the hiring rate as a percentage of all employed fell to 3.5% from 3.6% in August, the same as at was in September a year earlier (details of hiring by sector since March are in table 2)….meanwhile, total separations fell by 148,000, from 5,052,000 in August to 4,914,000 in September, while the separations rate as a percentage of the employed fell from 3.5% to 3.4%, which was also down from 3.5% in September a year ago (see table 3)…subtracting the 4,914,000 total separations from the total hires of 5,081,000 would imply an increase of 168,000 jobs in September, a bit less than the revised payroll job increase of 191,000 for September reported in the October establishment survey last week, but still within the expected +/-115,000 margin of error in these incomplete samplings

breaking down the seasonally adjusted job separations, the BLS finds that 3,070,000 of us voluntarily quit our jobs in September, up from the revised 3,009,000 who quit their jobs in August, while the quits rate, widely watched as an indicator of worker confidence, remained unchanged at 2.1% of total employment, while it was up from 1.9% a year earlier (see details in table 4)….in addition to those who quit, another 1,474,000 were either laid off, fired or otherwise discharged in September, down by 165,000 from the revised 1,639,000 who were discharged in August, as the discharges rate fell from 1.2% to 1.0% of all those who were employed during the month, a record low that was also down from the discharges rate of 1.3% a year earlier….meanwhile, other separations, which includes retirements and deaths, were at 370,000 in September, up from 351,000 in August, for an ‘other separations rate’ of 0.3%, which was up from 0.2% in August, but the same as the ‘other separations rate’ of 0.3% in September of last year….both seasonally adjusted and unadjusted details by industry and by region on hires and job separations, and on job quits and discharges can be accessed using the links to tables at the bottom of the press release

September Wholesale Sales Up 0.2%, Wholesale Inventories Up 0.1%

the September report on Wholesale Trade, Sales and Inventories (pdf) from the Census Bureau estimated that the seasonally adjusted value of wholesale sales was at $444.9 billion, up 0.2 percent (+/-0.4%) from the revised August level, and up 0.4 percent (+/-1.1%) from wholesale sales of September 2015… the August preliminary estimate was revised down to $444.1 billion from the $444.3 billion in wholesale sales reported last month, which nonetheless left the July to August change statistically unchanged at +0.7%…. September wholesale sales of durable goods were up 0.2 percent (+/-0.7%) from last month and were up 0.2 percent (+/-1.8%) from a year earlier, with a 1.5% increase in wholesale sales of electrical and electronic goods leading the increase for the month, partially offset by 2.4% lower wholesale sales of hardware, plumbing and heating equipment and supplies….wholesale sales of nondurable goods were up 0.1 percent (+/-0.7%) from August and were up 0.5 percent (+/-1.2%) from last September, with a 5.0% increase in wholesale sales of petroleum and petroleum products offsetting a 12.0% decrease in wholesale sales of farm product raw materials…as an intermediate activity, wholesale sales are not included in GDP except insofar as they are a trade service, since the traded goods themselves do not represent an increase in the output of the goods produced or finally sold….

on the other hand, the monthly change in private inventories is a major factor in GDP, as additional goods left in a warehouse represent goods that were produced but not sold, and this September report estimated that wholesale inventories were valued at a seasonally adjusted $590.2 billion at month end, up 0.1 percent (+/-0.2%) from the revised August level but 0.1 percent (+/-1.9%)* lower than in September a year ago….August’s inventory value was revised from $589.1 billion to $589.45 billion, which meant that the August to September percent change was revised from the advance estimate of down 0.2 percent (+/-0.4%) to down 0.1 percent (+/-0.4%)…wholesale inventories of durable goods were down 0.4 percent (+/-0.4%) from August, and were down 1.9 percent (+/-1.6%) from a year ago, with 1.7% lower wholesale inventories of motor vehicle and motor vehicle parts driving the September decrease…at the same time, the value of wholesale inventories of nondurable goods were up 0.9 percent (+/-0.4%) from August and were up 2.7 percent (+/-3.3%) from last September, as the value of wholesale inventories of petroleum and petroleum products were up 3.8% and inventories of drugs and druggists’ sundries were up 3.3%..

the BEA’s technical note for 3rd quarter GDP indicates that they had estimated that the value of wholesale inventories to be at $590.7 billion in September, up from 589.5 billion in August, which they based on the new Advance Economic Indicators Report from the Census Bureau, a sketchy report which had been released before the advance GDP report…this report thus revises that advance report and thus reports that end of September wholesale inventories were actually $0.5 billion less than had been indicated in the GDP report, or a revision to annualized nominal growth in inventories at $2.06 billion annual rate, thus implying an downward revision of 0.06 percentage points to 3rd quarter GDP…note that we are not adjusting these GDP revision estimates for inflation because we have assumed that the same deflators that were used in the advance report on 3rd quarter GDP will be used in the GDP revisions…

Mortgage Delinquencies Up Slightly in September, New Foreclosures Down 10.3%

the Mortgage Monitor for September (pdf) from Black Knight Financial Services (BKFS, formerly LPS) reported that there were 509,047 home mortgages, or 1.04% of all mortgages outstanding, remaining in the foreclosure process at the end of September, which was down from 527,298, or 1.04% of all active loans, that were in foreclosure at the end of August, and down from 1.46% of all mortgages that were in foreclosure in September of last year…..these are homeowners who at least had a foreclosure notice served, but whose homes had not yet been seized, and the September “foreclosure inventory” now represents the lowest percentage of homes that remained in the foreclosure process since the spring of 2007… new foreclosure starts, which have been volatile from month to month, fell to 61,664 in September from 68,820 in August and were down from the 79,900 new foreclosures we saw in September a year ago…as foreclosure starts in April of this year were at the lowest level in over ten years, new foreclosures for the year have remained close to the levels of foreclosure starts we saw during 2005 and 2006, before the mortgage crisis began…

in addition to homes in foreclosure, Mortgage Monitor data also showed that 2,164,820 mortgages, or 4.27% of all mortgage loans, were at least one monthly mortgage payment overdue but not in foreclosure at the end of September, up from the 4.24% of homeowners with a mortgage who were more than 30 days behind in August, but down from the mortgage delinquency rate of 4.87% in September a year earlier, while also up from the mortgage crisis low of 4.08% of all mortgages that were delinquent in March …of those who were delinquent in September, 668,114 home owners, or 1.32% of those with a mortgage, were more than 90 days behind on mortgage payments, but still not in foreclosure at the end of the month, which was down a bit from the 669,173 such “seriously delinquent” mortgages in August…combining the total number of delinquent mortgages with those in foreclosure, we find that a total of 2,673,867 mortgage loans, or 5.28% of homeowners with a mortgage, were either late in paying or in foreclosure at the end of September, and that 1,177,161, or 2.32% of all homeowners, were in serious trouble, ie, either “seriously delinquent” or already in foreclosure at month end…

 

(the above is the synopsis that accompanied my regular sunday morning links emailing, which in turn was mostly selected from my weekly blog post on the global glass onion…if you’d be interested in receiving my weekly emailing of selected links, most from the aforementioned GGO posts, contact me…)                

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