Nonbank mortgage jobs rise for the first time in a year

Nondepository payrolls in the housing finance industry stopped falling and inched up in April, ending 12 months of declines, according to the Bureau of Labor Statistics.

Mortgage bankers and brokers collectively employed an estimated 341,000 people during the month, up slightly from 340,100 in March, when numbers suggested the majority of industry jobs cuts had been made. The BLS numbers come from two representative categories and underestimate employment for residential real estate lending as a whole.

The data suggests some retention and hiring for the spring homebuying season has stemmed the tide of industry layoffs, at least for now.

Jobs cuts in the larger market, which are reported with less of a lag than mortgage estimates, were a little higher in May. The overall unemployment rate inched up to 3.7% from a historic low of 3.4% during the month even though the number for payroll additions during the month, 339,000, was higher than earlier consensus estimates.

"A strong job market helps housing demand, particularly in the face of challenging affordability," said Mike Fratantoni, senior vice president and chief economist at the Mortgage Bankers Association, in an emailed statement. However, supply remains limited, he noted.

The latest numbers mean there could be less upward pressure on rates in the immediate future, and that could help with affordability, said Fratantoni.

"Several Federal Reserve officials have signaled that they are likely to hold rates steady at their upcoming June meeting but are unlikely to reduce rates anytime soon. This somewhat mixed jobs report is likely to support that approach," he said.

However, the plateau in short-term rates is not a given and may not last, according to Ksenia Potapov, an economist at First American.

While a recent Federal Open Market Committee statement hinted that the Fed would hit pause, the strength in May's job gains "increases the likelihood that more rate hikes are ahead," Potapov said in an email.

One positive for the housing market found in the job numbers has been the fact that employment in construction has been bearing up, Potapov said. Residential building construction employment rose 0.8% year over year, and also was up from the previous month.

"The continued strength is partially due to the years-long struggle that builders have had attracting and retaining skilled construction workers, making them less likely to part with skilled workers, even in a weaker housing market," she said.