WREN Report: Furnishings Employment Stable; U.S. Unemployment Rate Surges

June 8, 2008  by in UnCategorized   

By Home Furnishings Business in on June 2008 • Last week finished badly, with employment, stocks, gas prices and home foreclosures all hitting sour notes. The U.S. Bureau of Labor Statistics (BLS) reported the overall May unemployment rate jumped half a point to 5.5 percent as 49,000 Americans lost their jobs.

In the home furnishings sector, May manufacturing employment of 502,500 was off 0.6 percent from April. Compared with May 2007, home furnishings manufacturing employment fell 6.7 percent. On the retail side, employment inched up 0.1 percent in May versus April, to 570,100 jobs. That’s a decline of 1.8 percent from May of last year, BLS reported.

• On Friday, the Dow Jones Industrial Average fell nearly 400 points, finishing at 12,209.81, off 3.1 percent. The price story on furniture stocks was mostly down, although some companies, such as vendor Hooker Furniture, managed to gain in this unsteady economic climate. Hooker closed at $20.62 per share, a 1.08 percent increase in price.

• Oil prices, after appearing to stabilize earlier in the week, finished at nearly $140 a barrel on Friday. According to one pundit, the increase in the cost of a barrel of oil last week equaled the total cost of a barrel in 1999.

At the pump, AAA and the Oil Price Information Service reported that the national average price for a gallon of regular gas rose to $4.005 on Sunday from $3.988 the day before. This is the first time the average hit $4 a gallon, and some economists are predicting $5 gas by summer’s end.

• More than 1 million homes are now in foreclosure, the highest rate ever recorded, according to a Mortgage Bankers Association (MBA) report. After studying first quarter figures, MBA said that a record 2.5 percent of all loans serviced by its members are now in foreclosure. Doing the math, that means the loans on about 1.1 million homes are in trouble. That’s up from 2 percent of home loans in foreclosure at the end of 2007.

According to the report, homeowners holding nearly 3 million home loans, or 6.4 percent of all loans, have missed at least one mortgage payment.

Weekly Review of Economic News (WREN) reports are summaries of recently-released economic statistical data that affect the home furnishings industry. WREN reports are compiled by HFB Research Editor Janice Chamberlain.