by Calculated Risk on 9/05/2022 01:40:00 PM

Here is a look at the change in teen employment over time.

The graph below shows the employment-population ratio for teens (6 to 19 years old) since 1948.

The graph is Not Seasonally Adjusted (NSA), to show the seasonal hiring of teenagers during the summer.

A few observations:
1) Although teen employment has recovered some since the great recession, overall teen employment had been trending down. This is probably because more people are staying in school (a long term positive for the economy).

2) Teen employment was significantly impacted in 2020 by the pandemic.

Click on graph for larger image.

3) A smaller percentage of teenagers are obtaining summer employment. The seasonal spikes are smaller than in previous decades. 

The teen employment-population ratio was 36.5% in August 2022, up from 34.7% in August 2021. The teen participation rate was 40.6% in August 2022, up from 38.9% the previous July. 

In general, a smaller percentage of teenagers are joining the labor force during the summer as compared to previous years. This could be because of fewer employment opportunities, or because teenagers are pursuing other activities during the summer.

3) The decline in teenager participation is one of the reasons the overall participation rate has declined (of course, the retiring baby boomers is the main reason the overall participation rate has declined over the last 20+ years).

by Calculated Risk on 9/05/2022 10:42:00 AM

Inventory decreased slightly last week.  Still, inventory decreased less than in 2019 at this time of year.  Here are the same week inventory changes for the last four years:

2022: -2.2K

2021: +6.2K

2020: -7.6K

2019: -6.5K

Inventory bottomed seasonally at the beginning of March 2022 and is now up 129% since then.  More than double!  Altos reports inventory is up 26.3% year-over-year.  Note: Inventory peaked this week in 2021.

Click on graph for larger image.

This inventory graph is courtesy of Altos Research.

As of September 2nd, inventory was at 553 thousand (7-day average), compared to 555 thousand the prior week.  Inventory was down 0.4% from the previous week. 

Inventory is still historically low. Compared to the same week in 2021, inventory is up 26.3% from 437 thousand, however compared to the same week in 2020 inventory is down 5.4% from 584 thousand.  Compared to 3 years ago, inventory is down 42.2% from 956 thousand.

Here are the inventory milestones I’m watching for with the Altos data:

1. The seasonal bottom (happened on March 4th for Altos) ✅

2. Inventory up year-over-year (happened on May 13th for Altos) ✅

3. Inventory up compared to two years ago (currently down 5.4% according to Altos)

4. Inventory up compared to 2019 (currently down 42.2%).

Here is a graph of the inventory change vs 2021, 2020 (milestone 3 above) and 2019 (milestone 4).

The blue line is the year-over-year data, the red line is compared to two years ago, and dashed purple is compared to 2019.

Two years ago (in 2020) inventory was declining all year, so the two-year comparison will get easier all year.  

Based on the recent changes in inventory, my current estimate is inventory will be up compared to 2020 in October of this year.

A key will be if inventory increases in September.   

Mike Simonsen discusses this data regularly on Youtube.

by Calculated Risk on 9/05/2022 08:21:00 AM

These indicators are mostly for travel and entertainment.    It is interesting to watch these sectors recover as the pandemic subsides.  Notes: I've added back gasoline supplied to see if there is an impact from higher gasoline prices.

----- Airlines: Transportation Security Administration -----
The TSA is providing daily travel numbers.

This data is as of September 4th.

Click on graph for larger image.

This data shows the 7-day average of daily total traveler throughput from the TSA for 2019 (Light Blue), 2020 (Black), 2021 (Blue) and 2022 (Red).

The dashed line is the percent of 2019 for the seven-day average.

The 7-day average is down 3.4% from the same day in 2019 (90.9% of 2019).  (Dashed line) 

Air travel - as a percent of 2019 - had been moving sideways over the last several months, off about 10% from 2019.   Travel has picked up recently, compared to 2019, perhaps due to the timing of Labor Day.

----- Movie Tickets: Box Office Mojo -----
This data shows domestic box office for each week and the median for the years 2016 through 2019 (dashed light blue).  

Black is 2020, Blue is 2021 and Red is 2022.  

The data is from BoxOfficeMojo through September 1st.

Note that the data is usually noisy week-to-week and depends on when blockbusters are released.  

Movie ticket sales were at $78 million last week, down about 53% from the median for the week.

----- Hotel Occupancy: STR -----
This graph shows the seasonal pattern for the hotel occupancy rate using the four-week average.

The red line is for 2022, black is 2020, blue is the median, and dashed light blue is for 2021. Dashed purple is 2019 (STR is comparing to a strong year for hotels).

This data is through August 27th. The occupancy rate was down 2.5% compared to the same week in 2019.

The 4-week average of the occupancy rate is close to the median rate for the previous 20 years (Blue).

Notes: Y-axis doesn't start at zero to better show the seasonal change.

----- Gasoline Supplied: Energy Information Administration -----

This graph, based on weekly data from the U.S. Energy Information Administration (EIA), shows gasoline supplied compared to the same week of 2019.

Blue is for 2020.  Purple is for 2021, and Red is for 2022.

As of August 26th, gasoline supplied was down 13.2% compared to the same week in 2019.

Recently gasoline supplied has been running below 2019 and 2021 levels - and sometimes below 2020.

by Calculated Risk on 9/04/2022 09:01:00 AM

From CoStar: STR: US Hotel Performance Closes August a Bit Mixed

U.S. hotel performance came in lower than the previous week and showed mixed comparisons with 2019, according to STR‘s latest data through Aug. 27.

Aug. 21-27, 2022 (percentage change from comparable week in 2019*):

• Occupancy: 65.0% (-2.5%)
• Average daily rate (ADR): $147.16 (+15.0%)
• Revenue per available room (RevPAR): $95.62 (+12.1%)

*Due to the pandemic impact, STR is measuring recovery against comparable time periods from 2019.
emphasis added

The following graph shows the seasonal pattern for the hotel occupancy rate using the four-week average.

Click on graph for larger image.

The red line is for 2022, black is 2020, blue is the median, and dashed light blue is for 2021.  Dashed purple is 2019 (STR is comparing to a strong year for hotels).

The 4-week average of the occupancy rate is close to the median rate for the previous 20 years (Blue).

Note: Y-axis doesn't start at zero to better show the seasonal change.

The 4-week average of the occupancy rate has peaked seasonally and will now decline into the Fall.

by Calculated Risk on 9/03/2022 02:11:00 PM

At the Calculated Risk Real Estate Newsletter this week:

• Case-Shiller National House Price Index "Decelerated" to 18.0% year-over-year increase in June

• Inflation Adjusted House Prices Declined in June

• Pace of Rent Increases Continues to Slow

• Will House Prices Decline Nationally?

• Active vs Total Existing Home Inventory

• 30-Year Mortgage Rates Pushing 6% Again


This is usually published 4 to 6 times a week and provides more in-depth analysis of the housing market.

You can subscribe at https://calculatedrisk.substack.com/

Most content is available for free (and no Ads), but please subscribe!

by Calculated Risk on 9/03/2022 08:11:00 AM

This will be a light week for economic data.

----- Monday, Sept 5th -----
All US markets will be closed in observance of the Labor Day holiday.

----- Tuesday, Sept 6th -----
8:00 AM ET: Corelogic House Price index for July

10:00 AM: the ISM Services Index for August.   The consensus is for a reading of 55.5, down from 56.7.

----- Wednesday, Sept 7th -----
7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.

8:30 AM: Trade Balance report for July from the Census Bureau.

This graph shows the U.S. trade deficit, with and without petroleum, through the most recent report. The blue line is the total deficit, and the black line is the petroleum deficit, and the red line is the trade deficit ex-petroleum products.

The consensus is for the U.S. trade deficit to be $70.5 billion in July, from $79.6 billion in June.

At 12:35 PM: Speech, Fed Vice Chair Brainard, Economic Outlook and Monetary Policy, At The Clearing House and Bank Policy Institute Annual Conference, New York, N.Y.

2:00 PM: the Federal Reserve Beige Book, an informal review by the Federal Reserve Banks of current economic conditions in their Districts.

----- Thursday, Sept 8th -----
8:30 AM: The initial weekly unemployment claims report will be released.  The consensus is for an increase to 240 thousand from 232 thousand last week.

9:10AM: Discussion, Fed Chair Powell, At the Cato Institute’s 40th Annual Monetary Conference

----- Friday, Sept 9th -----
12:00 PM: Q2 Flow of Funds Accounts of the United States from the Federal Reserve.

by Calculated Risk on 9/02/2022 09:09:00 PM

On COVID (focus on hospitalizations and deaths):

COVID Metrics
	Now	Week Ago	Goal
New Cases per Day2	83,939	91,017	≤5,0001
Hospitalized2	31,020	33,091	≤3,0001
Deaths per Day2	407	422	≤501
1my goals to stop daily posts, 27-day average for Cases, Currently Hospitalized, and Deaths 🚩 Increasing 7-day average week-over-week for Cases, Hospitalized, and Deaths ✅ Goal met.

Click on graph for larger image.

This graph shows the daily (columns) and 7-day average (line) of deaths reported.

Average daily deaths bottomed in July 2021 at 214 per day.

by Calculated Risk on 9/02/2022 02:35:00 PM

Today, in the Calculated Risk Real Estate Newsletter: Will House Prices Decline Nationally?

Excerpt:

And yesterday, in an interview with Bilal Hafeez, Ivy Zelman, CEO of Zelman & Associates forecast national house price declines of 4% in 2023, and 5% in 2024: Ivy Zelman on the Coming US Housing Crisis (price discussion starts at around 20:00)

There are some mortgage guard rails that could mitigate nationally a severe downturn, and yet the magnitude of the decline for us - the 4% that we are expecting in 2023, and 5% in 2024 -I feel like it is a starting point … the speed of the declines makes us feel like that maybe that could be conservative. But we could see double digit price corrections [in the] hot markets.

There are some factors arguing against national price declines. ...

But there are also factors arguing for national price declines.

There is much more in the article. You can subscribe at https://calculatedrisk.substack.com/

by Calculated Risk on 9/02/2022 01:14:00 PM

From BofA:

Our 3Q US GDP tracking estimate rose to 1.3% q/q seasonally adjusted annualized rate (SAAR), up from from 0.5% q/q saar last wee [September 2nd estimate]
emphasis added

From Goldman:

[D]ata on employment, auto sales, and factory orders caused our US 3Q GDP tracking estimate to fall by two-tenths, to 1.1% q/q saar, from 1.3% previously. [September 2nd estimate]

And from the Altanta Fed: GDPNow

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2022 is 2.6 percent on September 1, up from 1.6 percent on August 26. [September 1st estimate]

by Calculated Risk on 9/02/2022 11:23:00 AM

The BEA released their estimate of vehicle sales for August this morning.

This graph shows heavy truck sales since 1967 using data from the BEA. The dashed line is the August 2022 seasonally adjusted annual sales rate (SAAR).

Heavy truck sales really collapsed during the great recession, falling to a low of 180 thousand SAAR in May 2009.  Then heavy truck sales increased to a new all-time high of 570 thousand SAAR in April 2019.

Click on graph for larger image.

Note: "Heavy trucks - trucks more than 14,000 pounds gross vehicle weight."

Heavy truck sales declined sharply at the beginning of the pandemic, falling to a low of 308 thousand SAAR in May 2020.  

Heavy truck sales were at 441 thousand SAAR in August, up from 468 thousand in July, and up from 417 thousand SAAR in August 2021.  

Usually, heavy truck sales decline sharply prior to a recession.   Sales were reasonably solid in August.