Select Your Location
View available investments and insights in your market
Americas
Europe and the Middle East
Asia Pacific

Global Macro Chart of the Month

September 2024
The Employment ‘Mystery’
The current hiking cycle is generating a range of anomalies that we believe investors should be exploring. On the heels of a key employment report that delivered lower than expected new payrolls last Friday, we thought we’d devote this month’s chart to what we believe is yet another curiosity: the growing divergence between residential construction employment and housing permits/starts, which we believe could have implications for the broader economy.
DOWNLOAD
Global Macro Chart of the Month August 2024
Source: Neuberger Berman, Bloomberg, as of August 2024
Highlights
  • As shown above, residential construction and employment data have been heavily influenced by the 2008 housing crisis, although residential construction employment (in blue) followed permits (gray) and starts (teal) lower in 2000 as well as in the 2020 COVID-based recession.
  • However, the direction of employment has now diverged from permits and starts for over two years.
  • Various idiosyncratic factors may be driving this divergence, including mortgage subsidies from home builders and immigration trends in the labor force.
  • Still, it seems likely that the divergence could eventually become too wide, with a lack of improvement in starts and permits leading to softening demand for labor.
  • In our view the residential construction sector remains one to watch “beneath the surface” of the headline jobs prints for evidence that labor market may be turning—something that we believe could signal slower growth for the economy moving forward.
Previous Month - August 2024
For Every Action, There Is an Equal and Opposite Reaction...
DOWNLOAD