April is going to be one of the most critical months for America in recent history. This month with lockdown protocols in place in many areas of the country, we are going to make our first real attempt to bring that virus new case curve lower. I still believe in my May 18th thesis that the data will be better on that date. ( Hopefully earlier). Then by September 1st, we will be in a much better place against this virus for any second wave to come in fall and winter.
However, today is another AD (After the disease) data line. The U.S. went straight into a recession from February to March as lockdown protocols took hold. The ADP data went negative today, but the reason it isn’t worse right now is that that the data really only reflects in the early portion of March. Except millions of more jobless claims tomorrow to occur.
ADP, like the BLS jobs data, had an impressive 3-month average until the recession started.
From Doug Short:
ADP National Employment Report: Private Sector Employment Decreased by 27,000 Jobs in March; the March NER Utilizes Data Through March 12 and Does Not Reflect the Full Impact of COVID-19 on the Overall Employment Situation
Regarding purchase application data. We had another negative year over year print today. Down 24% year over year.
We can clearly see the difference between BC (Before Coronavirus) vs. AD data now.
Purchase Application Heat Months Tracker: Down 24% year over year 2 week AD average now – 17.5%
For some context, In 2014, Application data was down negative 20% on trend year over year.
From Calculated Risk:
For HousingWire, I address this issue with more details in this article, where I talked about how to purchase application data can be down 54% plus year over year.
How far this recession could drive down purchase mortgage applications
At some point, we will move from AD data to AB ( America is back). However, we have a lot of work to do as a country to get there. I can’t wait to defeat this virus and have Americans walk the earth again without social distancing.
Logan Mohtashami is a financial writer and blogger covering the U.S. economy with a specialization in the housing market. Logan Mohtashami is a senior loan officer at AMC Lending Group, which has been providing mortgage services for California residents since 1987. Logan also tracks all economic data daily on his Facebook page https://www.facebook.com/Logan.Mohtashami and is a contributor for HousingWire.
Hi Logan – BLS will suffer from the same issue with the upcoming jobs report. You’ll find this interesting – job adverts during the first two weeks of March exceeded February levels by nearly 50%. Then they crashed during the second two weeks. It’s a bleak picture.
Yes, BLS is going to lag. In fact the velocity of this recession took 16 days that monthly data can’t capture how bad March was only weekly data
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