Economy Watch: New Homes Sales Dip in December, Up Year Over Year
Home sales dip in December, and President Obama will address the situation of long-term unemployment in tonight's State of the Union address.
By Dees Stribling, Contributing Writer
The Census Bureau reported on Monday that new home sales took a dip in December, down 7 percent to an annualized rate of 414,000 units, compared with November’s rate. Still, that’s 4.5 percent higher than the December 2012 rate of 396,000 units.
When taken as a whole, new home sales did fairly well last year. In 2013 homebuilders managed to sell 428,000 units, a 16.4 percent increase from the 2012 total of 368,000 units. In fact, 2013 was the strongest year for new homes sales since 2008, when 485,000 units sold, but at that time the air was rushing out the market. The lowest-ever number of U.S. new home sales was recorded in 2011, at 306,000 units.
Even so, last year’s level of sales wasn’t especially strong by historic standards, coming in at the sixth-weakest year ever recorded. Even sales in the early 1960s — when the government started compiling the data and when there were a lot fewer Americans to buy houses — were stronger than 2013 or any of the other years since 2008.
Long-term Unemployment Spotlighted in State of Union
One initiative that President Obama is expected to announced in his State of the Union address on Tuesday is, historically speaking, an unusual one: dealing with the long-term unemployed. According to the Wall Street Journal , the president will tell the country that certain major employers — such as Xerox, AT&T, and Procter & Gamble — have inked a pledge with the White House not to discriminate against the long-term unemployed when making hiring decisions.
The initiative, though not involving a change in the law or an executive order, will presumably be designed to spotlight a problem that the long-term unemployed face, besides being unemployed for a long time. Namely, the notion among some employers that the longer someone is out of work, the less employable they are (or even in some cases, a reluctance to hire anyone who’s unemployed).
A large pool of the long-term unemployed people is one of the persistent and doleful legacies of the Great Recession. According to the most recent monthly employment report by the Bureau of Labor Statistics, about 3.9 million people are officially classified as long-term unemployed by the government (that is, out of work more than 27 weeks). The total went down by 894,000 during 2013, but it still remains persistently high.
Wall Street had another down day on Monday, but not as much as the beating it took during the previous two trading days. Dow Jones Industrial Average dropped 41.23 points, or 0.26 percent. The S&P 500 was down 0.49 percent and the S&P 500 was off 1.08 percent.