Economist's Commentary: June 12, 2008

Quick Take on the Economy: June 12, 2008

By Lawrence Yun, NAR Chief Economist

The first-time jobless claims rose 25,000 in the past week. The continuing claims also increased by 58,000.
More people are showing up to get unemployment checks over the week. The current level of 384,000 first-time claimants and 3.14 million continuing claims are certainly higher compared to a year ago, and getting uncomfortably high, though still below the levels reached during the last recession in 2001.
The hard-hit real estate markets of California, Florida, and Michigan saw a mild reduction in jobless claims after having increased throughout most of last year.

Retail sales surprised on the upside with a solid 1.0 percent gain in May, even after accounting for the weak auto sales.
Sales rose the same similar amount for non-auto and non-gasoline sales. So the increase is not purely due to price increases at the pump, but genuine rise in unit sales.
Compared to a year ago, retail sales are up 2.5 percent - rather slow growth. Consumers bounced back a bit during the month, but the momentum is clearly for a slower consumer activity.

The job market is still struggling. Though, no major job cuts, job creation is not occurring.
Consumers came back in May. Tax rebate checks may be helping. But consumers will remain cautious.

This is one in a series of commentaries by the Research staff of the National Association of REALTORS®. Read more commentaries >

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