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CUNA's Hampel Makes Press Rounds on Improving Economy
Wednesday, November 12, 2014 6:35 AM

The Bureau of Labor Statistics reported Friday that the job market added 214,000 jobs in October and that the unemployment rate fell to a recession low of 5.8 percent. The Washington Post contacted Credit Union National Association Chief Policy Officer/Chief Economist Bill Hampel to get his take on the latest developments.

"What we're seeing in the labor market, it's not totally recovered yet, but it's recovering quite nicely now," Hampel told The Post (Nov. 7).

While hiring was below analysts' expectations, the shortfall was offset by upward revisions to August and September job-add data. The revisions made October the ninth-straight month the economy added more than 200,000 jobs.

Retail and health care saw the greatest increases in job growth for the month, and the share of working Americans climbed to its highest level since July 2009, at 59.2 percent, The Post reported.

The Wall Street Journal (Nov. 7) also picked up Hampel's breakdown of the job market in its Money Beat section's roundup of data and commentary, published each time the jobs report is released. Hampel gave his thoughts on why wage growth may continue to stall despite the falling unemployment rate.

"There's a reserve army of underemployed and discouraged workers out there," Hampel said, alluding to the fact that the share of Americans working or looking for work is the smallest since the 1970s. "We're not as close to full employment" as a 5.9 percent overall jobless rate may suggest.

Hampel's analysis was also featured in an article by The Fiscal Times about the potential for mortgage rates to climb in the coming months.

The decision by the Federal Reserve to curb its trillion-dollar bond-buying program has already spurred an uptick in mortgage rates. Rates had reached near-recession lows last month, setting off a wave of refinancing activity. But that opportunity may not last, Hampel told The Fiscal Times (Nov. 7).

"The window for refinancing may not be open for that long," Hampel said.

The Mortgage Bankers Association forecasted that rates will climb to 5.1 percent by the end of 2015 and 5.8 percent by the end of 2016, according to The Fiscal Times, which went on to detail how consumers can determine whether refinancing now makes sense.

If it would take less than three years to recoup all closing costs associated with the refinance, and the consumer plans to remain in the house for more than five years, it's probably a "no-brainer" to refinance, Hampel said.