Energy News Beat

Total Employment to be substantially revised higher early 2025 when the BLS incorporates these up-revisions into its household survey employment data.

By Wolf Richter for WOLF STREET.

The Census Bureau released its updated population estimates with data through July 2024 today, which corrected its vastly underestimated figure of immigrants for the past few years.

The prior Census Bureau data had so inadequately measured the tsunami of immigrants in 2021 through 2024 that it left policy makers, such as the Fed, in the dark about the supply of labor, employment, etc. To provide some insights, the Congressional Budget Office released its own estimates of population growth earlier this year, by incorporating data from Immigration and Customs Enforcement.

Today’s data by the Census Bureau confirms that it was truly a tsunami of immigrants that washed over the land. And now it’s official.

The US population surged by 8 million people in the three years from July 2021 through July 2024, to 340.1 million, according to the updated estimates from the Census Bureau today.

The 3.3 million net increase over the 12 months through July 2024 was the largest in decades. And the biggest portion of increases came from net-immigration (those that came in minus those that left or were removed):

• 2022: +1.92 million, incl. 1.69 million net immigration
• 2023: +2.80 million, incl. 2.29 million net immigration
• 2024: +3.31 million, incl. 2.79 million net immigration

In terms of the 2.79 million net immigration in the 12 months through July 2024, the Census Bureau said in its note about the improved methodology that this was “significantly higher than our previous estimates, in large part because we’ve improved our methodology to better capture the recent fluctuations in net international migration,” by among other things using “newly available administrative data [including from the Department of State Bureau of Consular Affairs and Refugee Processing Center; and from Homeland Security] to adjust the usually survey-based estimates of foreign-born immigration.”

“Improved integration of federal data sources on immigration has enhanced our estimates methodology,” The Census Bureau said.

In percentage terms, the population increased by nearly 1% over the 12 months through July 2024, the biggest percentage increase since 2001.

Over the three years through July 2024, the population increased by 2.4% (by 8.0 million people):

Coming Up-Revisions of Total Employment & Labor Force.

Early next year, the Bureau of Labor Statistics will incorporate these new population data into its employment-related data obtained from the household survey and substantially revise up its figures for labor force, total employment, and unemployment, and the metrics derived from those.

The household survey data – labor force, employment, unemployment, etc. – has been in the fog for two years due to this large underestimation of the working new arrivals and new arrivals still looking for work.

For the BLS employment data, legal status of the workers is irrelevant. It’s not even part of the data.

The newly arrived immigrants who either already have a job or are looking for a job count in the labor force, regardless of legal status. If they’re working, they count as workers, regardless of legal status. Those that have not found a job yet, but are looking for a job, show up as unemployed regardless of legal status.

So we expect large up-revisions of overall employment, the labor force, unemployment, and related metrics.

But the up-revisions might not move the unemployment rate much since they would largely cancel out in the calculation of the unemployment rate: up-revised number of unemployed divided by up-revised labor force.

The up-revision should re-establish the historic difference between total employment, which is based on the household survey and population data (red line in the chart below) and nonfarm payroll jobs, based on data from establishments (blue).

That long-established and normally fairly stable difference between total employment and nonfarm payrolls is mostly caused by certain self-employed workers and farm workers not being included in nonfarm payrolls, but being included in total employment.

By not adequately accounting for the newly arrived immigrant workers, total employment (red) stopped growing and even declined a little since early 2023, while nonfarm payrolls have continued to rise at a solid pace as employers reported their immigrant workers on the establishment surveys (blue).

The coming up-revision of total employment in the household survey should raise the red line and re-establish the typical difference to the blue line.

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The post Census Bureau Massively Revises Up Population Growth: +8 Million in 3 Years, +3.3 Million Last Year, Largely due to Immigration. US Population Surges to 340 Million appeared first on Energy News Beat.

 

Energy News Beat

Existing home sales rise from multi-decade rock-bottom, still -34% from 2021, -22% from 2019. Supply highest for November since 2018, days on market highest since 2019.

By Wolf Richter for WOLF STREET.

Sales of existing single-family houses, townhouses, condos, and co-ops that closed in November fell to 315,000 homes, according to data from the National Association of Realtors today. During the holiday period – from November through January – sales always drop from the prior months and reach the yearly low in January, and inventories drop too as people pull their homes off the market over the holidays.

Year-over-year, sales rose by 5.0% not seasonally adjusted, from the collapsed sales that closed in November last year after mortgage rates had briefly hit 8%. But compared to November 2021, sales were down by 37%. That’s the extent of demand destruction brought about by too-high prices.

The seasonally adjusted annual rate of sales, which attempts to iron out the seasonal decline over the holidays and multiplies this out to a 12-month period, rose by 4.8% in November from October to an annual rate of 4.15 million homes. This was still down by 34% from the same period in 2021 and by 22% from 2019, wobbling along the bottom for two years (historic data via YCharts):

Buyers’ strike leads to lowest annual sales since 1995.

The demand destruction in 2024 has been even larger than during the Housing Bust. With today’s actual sales figures for November (not seasonally adjusted), the WOLF STREET estimate for the whole year 2024 comes in at 4.04 million sales, the lowest since 1995, below even the worst years during the Housing Bust.

During the Housing Bust, demand destruction was caused by an economic and financial meltdown that had been preceded by years of reckless mortgage lending that then came home to roost and turned into the mortgage crisis.

But the 2023 and 2024 demand destruction was caused by a gigantic spike in prices – the NAR’s national median price shot up by nearly 50% from June 2019 through June 2022 – and then in 2023, mortgage rates returned to normal-ish levels in the 6%-7% range, up from the pandemic’s free-money range of less than 3% (historical data from YCharts).

Getting used to 6% to 7% mortgage rates.

The real estate industry has now given up on trying to outwait those mortgage rates and is exhorting sellers and buyers to get used to “a new normal of mortgage rates between 6% and 7%,” as the NAR put it today.

These 6% to 7% mortgage rates are of course the old normal mortgage rates that prevailed in the decades before the money-printing era of 2008 through 2021, and they’re unlikely to go back to the pandemic range.

Fannie Mae, the largest Government Sponsored Enterprise that buys and guarantees mortgages, came out earlier this month, encouraging mortgage investors, the real estate industry, home sellers, and home buyers to get used to these 6% to 7% mortgage rates:

“It is unlikely we will again see the low mortgage rates we had during the COVID-19 pandemic,” Fannie Mae wrote in a blog post, adding that “current mortgage rates and Fannie Mae’s forecast for 2025 rates are well in line with rates over the past several decades. Since 1990, the 30-year fixed-rate mortgage has averaged 6%.”

The average 30-year fixed mortgage rate rose to 7.14% today, according to the daily measure by Mortgage News Daily.

Freddie Mac’s weekly measure of the average 30-year fixed mortgage rate rose to 6.72% today.

Mortgage rates track the 10-year but at a higher level, with a spread between them that varies. And the 10-year yield has jumped by nearly 20 basis points to 4.58% since the Fed’s rate cut yesterday.

Mortgage rates have been above 6% since mid-2022. The market might as well get used to this mortgage rates and deal with them – and lower prices, after the ridiculous spike, will bring up the volume.

Before the 2008-2021 money printing era, 5% mortgages had been essentially unheard of:

Highest supply for any November since 2018.

Supply of unsold existing homes on the market, at 3.8 months (red line in the chart below), was the second highest for any November over the eight years 2017 through 2024, behind only 2018 (yellow). And that is plenty of supply.

Unsold inventory dipped to 1.33 million homes in November, as homes got pulled off the market over the holidays and as new listings declined from the prior month, as they always do over the holiday period.

Days on the market keep rising.

The median number of days before the home is either sold or pulled off the market because it failed to sell rose to 62 days in November, the most for any November since 2019, and up from 52 days a year ago, according to data from Realtor.com.

This is in part a measure of how motivated sellers are by letting their home sit on the market when it doesn’t sell right away.

Prices are way too high.

The median price of single-family houses edged down in November to $410,900, with the past three months in roughly a holding pattern, in line with pre-pandemic seasonality over those months through December. This seasonal pattern is usually followed by a big drop in January. Year-over-year, the price was up by 4.8%.

In the three years between June 2019 and June 2022, this national median price had exploded by nearly 50%, on top of the large price gains in prior 10 years, and this — driven at the time by the Fed’s interest-rate repression and money-printing schemes — has become the #1 problem in the housing market today:

The median price of condos and co-ops dipped to $359,800 in November, for a year-over-year gain of 2.8%. Unlike single-family house prices, the median condo price didn’t experience any outright year-over-year declines in mid-2023.

But home prices vary widely by metro. They have been dropping in some metros since 2022, but continued to rise in other metros through the summer, with declines now getting started in metros even where prices are not seasonal, based on Zillow’s “raw” mid-tier home price index. The two bookends of our series covering 33 markets, The Most Splendid Housing Bubbles in America, show the divergence, with Austin prices having plunged by 22% from the peak in mid-2022, while prices in the New York City metro eked out gains through October before seeing the first dip:

Demand destruction by region.

The charts below show the seasonally adjusted annual rate of sales, released by the NAR today, in the four Census Regions of the US. A map of the four regions is in the comments below the article.

Northeastern US: The seasonally adjusted annual rate of sales rose to 510,000 homes:

Midwestern US: The seasonally adjusted annual rate of sales rose to 1,000,000 homes.

Southern US: The seasonally adjusted annual rate of sales rose to 1,870,000 homes.

Western US: The seasonally adjusted annual rate of sales unchanged at 770,000:

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The post Home Sellers, Home Buyers, and Brokers Getting Used to the “New Normal” Old Normal 6-7% Mortgages? appeared first on Energy News Beat.

 

Energy News Beat

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When a solar energy developer approached Halifax County, North Carolina, in the early 2010s about renting its former airfield in Roanoke Rapids, community leaders had a condition. 

“If they were willing to lease this land for the very first solar project in the area, the county needed to get something back in return,” said Mozine Lowe from her office, which overlooks the 20 megawatt solar farm now atop the old airport. “What they got was this building.”

Of course, it’s more than a building. It’s the headquarters for the Center for Energy Education, the nonprofit Lowe has run since 2016 that works to maximize the benefits of large solar farms in rural America — one community, one school child, and one worker at a time. 

Lowe, who grew up about five miles from where she now works, had graduated from Greensboro’s North Carolina Agricultural and Technical State University but worked across the country, from California to Washington, D.C. 

When she returned to this rural county of less than 50,000 near the Virginia border, formerly a hub of farming and textiles, she said she didn’t see a lot of change.  

“The jobs were the same,” she said. “I didn’t see people making the connection between solar energy and what’s happening with the climate and the impact on rural communities, and I just wanted to try and help from that angle.” 

The Center conducts educational programs for children of all ages, who come in by the busload from surrounding schools both public and private. It holds a Solar Fest every year to celebrate clean energy with community leaders, drawing hundreds.

Through collaborations with local educational institutions like community colleges, the center has also helped to train a new workforce in jobs that pay roughly twice what workers are earning at the fast-food chains off Interstate 95. 

“We have trained more people than most other people around here to become solar installers,” Lowe said. “We want them to be first in line for our jobs.”

And there’s outreach to solar companies themselves in North Carolina as well as Kentucky, Ohio, and Indiana, where the Center also has offices. The goal is to help them become better community partners.

Geenex, the Charlotte-based developer who built the solar farm at the airport and over a dozen others in the vicinity, is still involved in the Center, and the company’s chairman also chairs the nonprofit’s board.  

But Lowe and other staff at the organization say not every solar developer is committed — at least at first — to working with community leaders in Eastern North Carolina. 

“Geenex is a very good partner,” said Reginald Bynum, the Center’s community outreach manager. “They’re a good player. But there are only a few of them. Other companies will say, ‘This is your ordinance? Great. This is all I have to do.’” 

Some county ordinances, like that in Halifax, need to be updated, Bynum said. Many still call for a 75-foot buffer between the rows of solar panels and neighboring properties. That figure is “so 2018,” said Bynum. It should be doubled, he said. 

Most solar farms are also built on private land — often bits of farmland that can help cotton growers and other farmers guarantee income. But developers usually obtain the leases first, before airing the project in public. 

“That’s the backwards process of solar,” Bynum said. “They’re talking to landowners and securing that land, and then they’re coming to commissioners.” 

What’s more, simply following ordinances isn’t enough, Bynum says. What’s needed is for solar developers to work with local residents to develop community benefits agreements – documents that memorialize pluses to the area, from minimizing construction impacts to providing jobs. 

“It’s a 30-year commitment to the community,” he said, “because your farm’s going to be here 30 years. They’re asking for that, and they deserve that.” 

Critically, say Bynum and other advocates, solar developers need to work with community leaders to provide benefits beyond tax revenue — an undeniable good, but one that isn’t “seen” by anyone except county bookkeepers.

And though a recent study from the North Carolina Sustainable Energy Association shows that solar farms today take up a fraction of a percent of the state’s farmland, the figure is a full 1% in Halifax County, and on pace to triple in the coming years, according to the Center’s research. 

“From rural citizens’ standpoint, that’s a lot,” Bynum said. “You have to really understand what they’re seeing.” 

Part of what they’re seeing is the result of a simple fact: solar farms aren’t just growing more abundant in parts of rural America. They’re also much larger.

In North Carolina up until 2016, the average utility-scale solar development was 5.8 megawatts covering 35 acres of land, per the Sustainable Energy Association. After a 2017 state law made larger solar farms easier to build, the average system size increased to 13.6 megawatts and covered 115 acres of land.

“Projects have gotten bigger,” said Carson Harkrader, the CEO of Durham-based Carolina Solar Energy, who appeared on a recent clean energy panel with Bynum. “As they’ve gotten bigger, people freak out a little bit.” 

And while many folks’ worries about the visual impact of solar panels can be mollified — with tree buffers, setbacks, and information about the safety of the structures — some are easy targets for opponents. 

“The opposition has become much, much, more organized. There are national groups, funded by the oil and gas industry,” Harkrader said. “With this opposition that is more organized and has more resources, it’s much harder.” 

In some cases, opponents may fill a vacuum left by solar companies who lined up projects before the pandemic and have only recently begun to start construction. 

That’s what happens, said Bynum, “when you miss steps in keeping citizens updated with the project — particularly when you started talking about it five years before. Commissioners change, a lot of tribal knowledge evaporates.” 

And sometimes, it only takes one or two community members to force the issue with local politicians. Both neighboring Northampton and Halifax counties have passed moratoriums on new solar farms recently. Halifax acted after just a few people appeared at their meeting, concerned about the loss of trees.

Having talked with county commissioners, staff at the Center are hopeful the moratorium will end quickly as planned, after the county has updated its ordinance. But the “pause” on solar farms is an example of the constant game of whack-a-mole solar developers and their advocates must play.

Lowe says that’s why the Center is so vital. 

“What makes us unique is that our work is mainly community engagement,” she said. “Our stance is to be neutral, and to provide factual information. I think we need to tell more success stories.”

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