Strong Labor Market Data: Solid Job Growth Offers Stability for Real Estate
- Jack Misraje
- Feb 7
- 2 min read

This week’s labor market data came in stronger than expected in many areas, providing a positive signal for the economy. Despite the strength in employment, mortgage rates moved slightly lower by the end of the week, offering potential relief for homebuyers.
Employment Data Shows Broad-Based Strength
The January Employment report showed that the economy added 143 thousand jobs, which was slightly below the expected 170 thousand. However, revisions to previous months added 100 thousand more jobs, bringing the overall outlook in line with expectations. Key areas of job growth included retail, health care, and government. The unemployment rate unexpectedly declined to 4.0 percent. Average hourly earnings rose 4.1 percent from one year ago, higher than the forecast of 3.9 percent. For real estate, steady job growth and rising wages help support buyer confidence and purchasing power. For sellers, a strong labor market increases the likelihood of qualified buyers remaining active even as rates fluctuate.
Job Openings Decline, Easing Wage Pressure
In contrast to the upbeat January Employment report, the latest data from the Job Openings and Labor Turnover Survey revealed that job openings dropped to 7.6 million at the end of December, below the forecast of 8.0 million. This marks the lowest number of openings since September and reflects a continued decline from the peak of more than 2 openings per worker in early 2022. The current ratio of 1.1 job openings per worker is similar to pre-pandemic levels. For the housing market, a slower pace of job openings could ease wage pressure, which in turn may help stabilize inflation and mortgage rates. Buyers may see some benefit in affordability, while sellers should monitor how changing job trends influence buyer confidence.
Services Slow Slightly While Manufacturing Rebounds
Reports from the Institute of Supply Management showed mixed results. The national services sector index fell to 52.8, slightly below forecasts, while the manufacturing index rose to 50.8, exceeding expectations and marking the highest reading since September 2022. A reading above 50 indicates expansion. For real estate, improvement in the manufacturing sector suggests potential growth in regions tied to industrial employment. The slight dip in service sector activity is unlikely to shift housing demand meaningfully in the short term but could reflect broader caution among consumers.
What This Means for Real Estate
The labor market remains a strong pillar of the economy, with wage growth and job gains providing a foundation for continued housing activity. For buyers, lower mortgage rates combined with solid employment conditions create a favorable environment for making a move. For sellers, buyer demand is likely to stay resilient as long as labor market trends remain positive.
As always, understanding how economic developments affect mortgage rates and buyer sentiment will help you make smarter real estate decisions. Whether buying or selling, staying informed is the key to success.
