Conference Board CEO confidence Index; 5/22

New York, NY, May 18, 2022…The Conference Board Measure of CEO Confidence™ in collaboration with The Business Council declined for the fourth consecutive quarter in Q2 2022. The measure now stands at 42, down from 57 in Q1. The Measure has fallen into negative territory and is at levels not seen since the onset of the pandemic. (A reading below 50 points reflects more negative than positive responses.)

The Q2 survey also asked CEOs to share their views on the Federal Reserve’s tightening policy. Notably, nearly 60 percent of CEOs expect inflation will come down over the next few years. But they also believe that the interest rate hikes that will tame inflation will cause a recession—albeit, a very brief, mild recession that the Fed offsets.

“CEO confidence weakened further in the second quarter, as executives contended with rising prices and supply chain challenges, which the war in Ukraine and renewed COVID restrictions in China exacerbated,” said Dana M. Peterson, Chief Economist of The Conference Board. “Expectations for future conditions were also bleak, with 60 percent of executives anticipating the economy will worsen over the next six months—a marked rise from the 23 percent who held that view last quarter.”

“Amid historically low unemployment and record job openings, nearly 70 percent of CEOs are combating a tight labor market by increasing wages across the board,” said Roger W. Ferguson, Jr., Vice Chairman of The Business Council and Trustee of The Conference Board. “On top of that, companies are grappling with higher input costs, which 54 percent of CEOs said they are passing along to their customers. This may contribute to cooling in consumer spending heading into the summer.”

Conference Board commentary on BLS labor statistics report for 1Q/22

Commentary on today’s U.S. Bureau of Labor Statistics Employment Situation Report

By Agron Nicaj, Associate Economist, The Conference Board

Today’s jobs report showed further job gains in April, following months of solid growth in the first quarter of 2022. The labor market continues to expand, especially in in-person services and in other industries that have yet to fully recover job losses incurred since the pandemic. Severe labor shortages continue to drive up wages, adding additional pressure on inflation. The labor market remains strong while the Federal Reserve maintains its focus on stabilizing prices with increasing interest rates and a commitment to shrinking their asset portfolio.

Nonfarm payroll employment increased by 428,000 in April, after a slight downwardly revised increase of 428,000 in March. The labor force participation rate decreased slightly to 62.2 percent, compared to 62.4 percent in March, while the unemployment rate remained unchanged at 3.6 percent. Overall, employment is still down 0.8 percent compared to pre-pandemic (February 2020) levels, representing 1.2 million jobs. Job recovery has been slower for women, with employment still 1.1 percent below pre-pandemic levels, compared to 0.5 percent for men.

Job growth continued to be strong in leisure and hospitality, which added 78,000 jobs in April. Transportation and warehousing added 52,000 jobs and manufacturing added 55,000 jobs. Compared to February 2020, however, employment is still down 19.1 percent in accommodation and 6.4 percent in food services and drinking places, indicating that in-person services industries have room to see additional job gains in 2022.

Average hourly earnings rose 5.5 percent over the past 12 months, with an 11.0 percent increase in leisure and hospitality and a 7.1 percent increase in transportation and warehousing. Wages will continue to rise steadily, especially in industries most impacted by labor shortages.

Severe labor shortages continue to impact recruiting and retention, with the March quits rate matching last year’s historical high of 3 percent. Labor force participation rates are not expected to rise significantly in 2022, especially among older workers, and there will continue to be more jobs than workers to fill them. Lingering fears of COVID-19 infection, lack of childcare options, early retirements, and other issues are all preventing more workers from re-joining the labor force.

The unemployment rate is expected to get close to 3 percent by the end of the year, with labor shortages showing no signs of alleviating. We also continue to expect 2.1 million more payroll employment gains this year. Wage growth will likely continue to accelerate as a result, adding further pressure on inflation. 

About The Conference Board The Conference Board is the member-driven think tank that delivers trusted insights for what’s ahead. Founded in 1916, we are a non-partisan, not-for-profit entity holding 501 (c) (3) tax-exempt status in the United States.

National new home sales metrics; March 2022

April 26, 2022 ‐ The U.S. Census Bureau and the U.S. Department of Housing and Urban Development jointly announced the following new residential sales statistics for March 2022:

New Home Sales
Sales of new single‐family houses in March 2022 were at a seasonally adjusted annual rate of 763,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development.
This is 8.6 percent (±12.9 percent)* below the revised February rate of 835,000 and is 12.6 percent (±11.3 percent) below the March 2021 estimate of 873,000.

Sales Price
The median sales price of new houses sold in March 2022 was $436,700. The average sales price was $523,900.

For Sale Inventory and Months’ Supply
The seasonally‐adjusted estimate of new houses for sale at the end of March was 407,000. This represents a supply of 6.4 months at the current sales rate.

Conference Board LEI; March, 2022

New York, April 21, 2022… The Conference Board Leading Economic Index® (LEI)for theU.S. increased by 0.3 percent in March to 119.8 (2016 = 100), following a 0.6 percent increase in February. The LEI increased by 1.9 percent in the six-month period from September 2021 to March 2022.

“The US LEI rose again in March despite headwinds from the war in Ukraine,” said Ataman Ozyildirim, Senior Director of Economic Research at The Conference Board. “This broad-based improvement signals economic growth is likely to continue through 2022 despite volatile stock prices and weakening business and consumer expectations. The Conference Board projects 3.0 percent year-over-year US GDP growth in 2022, which is slower than the 5.6 percent pace of 2021, but still well above pre-covid trend. This rate also reflects a 0.5 ppt downgrade incorporated in our base case to include the effects of the war in Ukraine compared to before the war (3.5 percent). However, downside risks to the growth outlook remain, associated with intensification of supply chain disruptions and inflation linked to lingering pandemic shutdowns and the war, as well as with tightening monetary policy and persistent labor shortages.”

National new home metrics; March 2022

Building Permits
Privately‐owned housing units authorized by building permits in March were at a seasonally adjusted annual rate of 1,873,000. This is 0.4 percent above the revised February rate of 1,865,000 and is 6.7 percent above the March 2021 rate of 1,755,000. Single‐family authorizations in March were at a rate of 1,147,000; this is 4.8 percent below the revised February figure of 1,205,000. Authorizations of units in buildings with five units or more were at a rate of 672,000 in March.
Housing Starts
Privately‐owned housing starts in March were at a seasonally adjusted annual rate of 1,793,000. This is 0.3 percent (±12.3 percent)* above the revised February estimate of 1,788,000 and is 3.9 percent (±8.9 percent)* above the March 2021 rate of 1,725,000. Single‐family housing starts in March were at a rate of 1,200,000; this is 1.7 percent (±12.3 percent)* below the revised February figure of 1,221,000. The March rate for units in buildings with five units or more was 574,000.
Housing Completions
Privately‐owned housing completions in March were at a seasonally adjusted annual rate of 1,303,000. This is 4.5 percent (±11.3 percent)* below the revised February estimate of 1,365,000 and is 13.0 percent (±9.8 percent) below the March 2021 rate of 1,497,000. Single‐family housing completions in March were at a rate of 1,000,000; this is 6.4 percent (±10.7 percent)* below the revised February rate of 1,068,000. The March rate for units in buildings with five units or more was 292,000

United States BLS weekly earnings summary; 1Q/22

USUAL WEEKLY EARNINGS OF WAGE AND SALARY WORKERS                                   FIRST QUARTER 2022


Median weekly earnings of the nation's 117.5 million full-time wage and salary workers were $1,037 in the first quarter of 2022 (not seasonally adjusted), the U.S. Bureau of Labor Statistics reported today. This was 4.9 percent higher than a year earlier, compared with a gain of 8.0 percent in the Consumer Price Index for All Urban Consumers(CPI-U) over the same period. 

Data on usual weekly earnings are collected as part of the Current Population Survey, a nationwide sample survey of households in which respondents are asked, among other things, how much each wage and salary worker usually earns.

Fed report on household debt and credit; 4Q/21

Auto Loan Originations Help Drive Total Household Debt to $15.58 Trillion

According to the latest Quarterly Report on Household Debt and Credit, total household debt rose by $333 billion (2.2 percent) to reach $15.58 trillion in the fourth quarter of 2021.

Mortgage balances—the largest component of household debt—rose by $258 billion.

The volume of newly originated auto loans was $181 billion during the fourth quarter, primarily reflecting a higher origination amount per loan rather than more loans originated.

Credit card balances increased by $52 billion, while student loan debt contracted by $8 billion, remaining roughly flat in nominal terms at the end of 2021 after almost two decades of steady increases.

Mortgage balances shown on consumer credit reports increased by $258 billion during the fourth quarter of 2021 and stood at $10.93 trillion at the end of December. Balances on home equity lines of credit (HELOC) were up very slightly, bucking a declining trend in place since 2016Q4, and keeping the outstanding balance at $318 billion. Credit card balances increased by $52 billion, the largest quarterly increase observed in the 22 year history of the data. Despite the substantial increase, credit card balances are $71 billion lower than at the end of 2019. Auto loan balances increased by $15 billion in the fourth quarter, a change similar to that seen in the fourth quarter in the previous two years. Student loan balances contracted by $8 billion in the fourth quarter of 2021, and marked a $21 billion increase since 2020Q4 –the smallest annual increase seen in nearly two decades. In total, non-housing balances grew by $74 billion, boosted additionally by a $15 billion increase in other balances.

Click on the following link to view the full report;

https://www.newyorkfed.org/microeconomics/hhdc

2021 United Van Lines National Movers Study

2021 United Van Lines National Movers Study

Conference Board Consumer Confidence Index; March 2022

The Conference Board Consumer Confidence Index® increased slightly in March, after a decrease in February. The Index now stands at 107.2 (1985=100), up from 105.7 in February. The Present Situation Index—based on consumers’ assessment of current business and labor market conditions—improved to 153.0 from 143.0 last month. However, the Expectations Index—based on consumers’ short-term outlook for income, business, and labor market conditions—declined to 76.6 from 80.8. 

“Consumer confidence was up slightly in March after declines in February and January,” said Lynn Franco, Senior Director of Economic Indicators at The Conference Board. “The Present Situation Index rose substantially, suggesting economic growth continued into late Q1. Expectations, on the other hand, weakened further with consumers citing rising prices, especially at the gas pump, and the war in Ukraine as factors. Meanwhile, purchasing intentions for big-ticket items like automobiles have softened somewhat over the past few months as expectations for interest rates have risen.”

“Nevertheless, consumer confidence continues to be supported by strong employment growth and thus has been holding up remarkably well despite geopolitical uncertainties and expectations for inflation over the next 12 months reaching 7.9 percent—an all-time high. However, these headwinds are expected to persist in the short term and may potentially dampen confidence as well as cool spending further in the months ahead.”

National new home sales metrics; February, 2022

New Home Sales
Sales of new single‐family houses in February 2022 were at a seasonally adjusted annual rate of 772,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development.

This is 2.0 percent (±11.9 percent)* below the revised January rate of 788,000 and is 6.2 percent (±13.7 percent)* below the February 2021 estimate of 823,000.

Sales Price
The median sales price of new houses sold in February 2022 was $400,600. The average sales price was $511,000.

For Sale Inventory and Months’ Supply
The seasonally‐adjusted estimate of new houses for sale at the end of February was 407,000. This represents a supply of 6.3 months at the current sales rate.