The Miami MSA labor market kept trucking along, building momentum in the first half of 2014. Miami added around 40,000 payroll jobs in the first two quarters of this year. We expect area employment to continue improving for the remainder of the year, growing by 3.0 percent for the full year 2014. This will outpace overall U.S. payroll growth, which is expected to increase by 1.8 percent. Labor force growth picked up pace as well in the first half of this year, following three negative quarters in 2013. The increased labor force participation led to an unchanged unemployment rate at 6.3 percent in 2014Q2. Labor markets are expected to tighten this year, driving the unemployment rate down to 5.8 percent by year-end.
Miami housing data has been mixed in the first half of 2014. Housing starts showed stronger growth for single-family homes, while multifamily housing starts recorded its second consecutive quarterly decline in Q2. Demand within single-family housing markets remains strong. The Miami Association of Realtors reported that single-family home sales grew 9.5 percent from a year ago in June. The improvement in single-family home sales is encouraging homeowners to put their homes on the market. This in turn is increasing the inventory of existing homes and helping to moderate home price growth in the region, down to 11.1 percent from a year ago in 2014Q2. Improving mortgage credit availability and relatively low mortgage rates are a positive for area housing markets headed into the second half of 2014.
Consumer spending continues to improve in the Miami area. According to the Florida Department of Revenue, gross sales for Miami-Dade County increased 7.0 percent from a year ago in June. The improving overall U.S. economy and stronger tourism will boost spending at Miami retailers. Sustained income growth, which is expected to increase by 5.0 percent in 2014, will also support ongoing gains in consumer activity this year.
Click here for the complete Miami MSA Regional Economic Update: Miami 2014Q2.