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Economic Update by P. DUFFY
Initial unemployment claims dip 4.1 percent to 779,000, but remain at elevated levels
In the week ending January 30, initial unemployment claims were 779,000, a decrease of 33,000, or 4.1 percent, from the previous week’s revised level. Continued claims during the week ending January 23 was 4,592,000, a decrease of 193,000, or 4.0 percent, from the previous week’s revised level. The total number of continued weeks claimed for benefits in all programs for the week ending January 16 was 17,835,525, a decrease of 486,405, or 2.7 percent, from the previous week.
Last year’s housing market lifted both suburban and urban housing markets
Despite some early pandemic-era narratives, suburban housing markets did not disproportionately strengthen in 2020 at the expense of urban areas. Rather, last year’s widespread growth in home sales and price appreciation, driven by strong housing demand, was a rising tide that broadly lifted all kinds of markets — with some notable exceptions. In some of the most-expensive markets, including New York and San Francisco, urban housing demand softened relative to the surrounding suburbs.
Planned job cuts rise 3.3 percent in January, but Covid no longer leading cause
Planned job cuts announced by U.S.-based companies rose 3.3%, to 79,552, in January, and were up 17.4% year-on-year. The leading reason for job cut announcements in January was demand downturn (29,822), followed by restructuring (19,256) and market conditions (15,056). COVID-19 was cited for just 4,620 job cuts in January, followed by business closings (4,358).
Multi-family sector surprises to upside in 4Q20, with recovery expected in second half of 2021
During 4Q20, certain multifamily segments performed better than average, including suburban submarkets, smaller markets, the Midwest, Mountain West and Southeast regions and Class B and C assets. Overall multifamily fundamentals should stabilize by Q2 2021. Steady market recovery is expected through the second half of 2021.