Employment at nondepository mortgage companies dropped considerably in November, as the combined effects of lower volumes and seasonal slowing reduced hiring needs.
Nonbank mortgage companies employed 337,000 workers in November, down 5,000 jobs from 342,000 jobs in October and 338,800 a year earlier, according to the Bureau of Labor Statistics. The BLS also added 500 jobs to its original October estimate.
Nondepository mortgage employment hasn’t been this low since May 2017, when independent mortgage banks and brokerages employed 334,200 workers. It’s also the largest one-month decline since January 2015, when nonbank mortgage companies cut 6,300 jobs.
Home sales usually peak in August and then slow through the fall and winter months, although consumers have been increasingly buying in the off-season to get better pricing. Prior to November, hiring levels at nonbank lenders had remained higher to court these homebuyers.
“With mortgage rates about a half point lower than late last year, the Fed likely to move more slowly going forward, and home-price growth slowing a bit, today’s report points to a still strong job market that should support a solid spring housing market in 2019,” Mike Fratantoni, chief economist at the Mortgage Bankers Association, said in a press release.
The BLS releases industry-specific employment data a month after its national estimates. Overall, companies added 312,000 jobs to their payrolls in December. The BLS also added to its original estimates for November and October. The BLS now estimates that employers added 176,000 jobs in November and 274,000 in October.
The December unemployment rate was 3.9%, up from 3.7% in November and an upwardly revised 3.8% in October, as more job seekers entered the market.
“With the latest revisions, the average job growth over the last three months — at 254,000 — is remarkably strong. This is good news for the housing market, where the strong job market boosts the confidence of potential homebuyers. The strong reading was certainly needed, given the incredible stock market volatility this past month,” Fratantoni said.