Mike: Wednesday is a quieter economic report day, but the MBA Purchase Applications report follows yesterday’s Housing Starts report, which showed some improvement from April’s record low. Unfortunately, the  MBA Purchase Applications report wasn’t the follow-through that many had expected. Purchase and refinance applications both fell as the U.S. mortgage applications plunge to near seven-month low report shows. IMHO there are a number of explanations of why mortgage applications are falling besides the rehashed rising interest rates reason. Here are a few of my thoughts:
  • Jobs, jobs, jobs: With people fearful of losing thier job, unemployment rising and jobs being harder to find, the number of people in a position to refinance or purchase has to decline. There are still over 600,000 people a week losing their jobs, and while that number my slowly improve, it’s a substantial number of people who are taken out of the home buying and refinancing pool.
  • The following report shows wage decline that has to influence home buying decisions:

The employed are also seeing less on their paychecks each month as less overtime is being offered and many are making a transition towards part-time work to save their jobs. The average person worked a little more than 33 hours last month, down since a low from 1964 and businesses have cut wages by 6.2% since last year. 9 million Americans that are currently working in part-time positions say they would rather have a full-time job. About the only place where you can count on a job with enough hours and good pay is in the government sector. Government pay has risen by 6.1% as government spending continues.

via Unemployment rate is not full picture of economy.

  • Many are no longer buying a new home to make a quick buck, so they may think why spend the extra thousands for closing and relocation costs during tough economic times to move sideways.
  • Most now realize that home prices are continuing to fall in most locations, so why purchase now when you may be able to get the same house 10% cheaper in September.
Those are just a few reasons, besides interest rate increases, for the decline in mortgage applications and I’m sure there are plenty of others.

NEW YORK (Reuters) – U.S. mortgage applications fell for a fourth consecutive week, with overall demand plunging to its lowest level in nearly seven months, data from an industry group showed on Wednesday.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications, which includes both purchase and refinance loans, for the week ended June 12 decreased 15.8 percent to 514.4, the lowest since the week ended November 21, 2008.

The MBA’s seasonally adjusted purchase index fell 3.5 percent to 261.2.

The Mortgage Bankers seasonally adjusted index of refinancing applications decreased 23.3 percent to 1,998.1, also the lowest since the week ended November 21, 2008.

via U.S. mortgage applications plunge to near seven-month low | Reuters .

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Larger layoff announcements and important economic reports:

Navigation links to today’s stories:

Microsoft/Google/IBM and other Rumors & News

ibm7– Essex Junction, Vt. — IBM is hiring 50 “long-term temp” workers at its manufacturing plant in Essex Junction, according to a company spokesman.

General Economic News

June 17 (Bloomberg) — Mortgage applications in the U.S. fell last week to the lowest level since November as the jump in borrowing costs over the last month caused refinancing to plunge further.

The Mortgage Bankers Association’s index of applications to purchase a home or refinance a loan dropped 16 percent to 514.4 in the week ended June 12, from 611 the prior week. The group’s refinancing gauge declined 23 percent, while the purchase index fell 3.5 percent.

“Higher mortgage rates will keep ‘refi’ activity under pressure,” Tom Porcelli, a senior economist at RBC Capital Markets in New York, said before the report. “That removes a source of what some had hoped would be an added kicker to consumer spending.”

via U.S. MBA Mortgage Applications Index Fell 16 Percent Last Week – Bloomberg.com.

Despite rising gasoline prices, overall retail prices in the United States barely budged in May, the government reported on Wednesday, a sign that inflation remained in check as the recession drags on.

The Labor Department said its consumer price index rose 0.1 percent last month after being unchanged in April. The index measures how much consumers spend on an array of goods and services, and is considered a gauge of inflation in the economy.

via Slight Rise in Consumer Prices in May – NYTimes.com.


Government Layoff News

– 65 teachers are on the chopping block in the Duluth School District, the decision came down Tuesday evening during the school board’s meeting.

via Duluth School Board Approves Layoff of 65 Teachers | Northland’s NewsCenter NBC 6, CBS 3, My 9, and Northland CW for Duluth MN / Superior WI | Local News .

– Layoff notices went out Tuesday to 15 full-time and two part-time employees in Southold Town, as local officials tried to reduce a projected $1.3-million deficit by year’s end.

via Southold sends layoff notices to 17 workers — Newsday.com.

– The executive director of the Massachusetts Turnpike Authority said 300 jobs will be eliminated once the Legislature approves a merger of the state’s transportation agencies.

via Pike chief: Reform to yield 300 job cuts – BostonHerald.com.

– About 100 jobs at the four correctional facilities in Kincheloe are anticipated to be cut as a result of announced closure of the Hiawatha Correctional Facility

via Job Cuts Will Number Roughly 100 at Prisons | www.stignacenews.com | St. Ignace News.

– The city of Tallahassee may cut as many as 80 filled positions once the 2009-10 fiscal year commences in October. Employees whose positions may be eliminated were notified Monday.

via City of Tallahassee to eliminate 112 positions; 80 are filled | tallahassee.com | Tallahassee Democrat.

– Faced with $7 million in budget reductions, Anoka County plans to cut 36 positions — with corrections, service centers and libraries among the hardest hit. But few, if any, layoffs are expected.

via Anoka County official says 36 jobs will go.

– The City of Wilmington says 8 firefighters will lose their jobs after their union voted not to pass up pay hikes for Fiscal Year 2010.

via 1150AM WDEL • WDEL.com • Dependable News, Delaware’s Views.

– Seven full-time teachers will be terminated June 30 as part of more than $3.4 million in budget cuts approved Tuesday afternoon by the Board of Education.

via 7 Norwich teachers losing jobs – Norwich, CT – Norwich Bulletin.

– Ware Shoals School District 51 cut eight positions, but was able to restore three jobs after receiving federal stimulus money.

via Ware Shoals School District Trims Jobs | WSPA.

– METHUEN — Twenty-seven Methuen public school employees are slated to be laid off July 1, Superintendent Jeanne Whitten says.

via 27 Methuen school employees to be laid off – EagleTribune.com, North Andover, MA.

– VANDALIA — Less than two months after announcing it would leave the safety components business, Delphi has advised Ohio government that it will permanently lay off about 116 local workers.

via Delphi to lay off Vandalia safety employees.

– City Commissioner Randy Leonard has scheduled a meeting with Bureau of Development Services employees tomorrow morning to explain why he’s laying off up to 48 of them at short notice on July 31, with two further rounds of layoffs coming down the pipe, the Mercury has learned.

via Breaking: Leonard Will Make Up To 150 Layoffs | Blogtown, PDX | Portland Mercury.

– WINNIPEG — A community newspaper division of the Winnipeg Free Press has laid off seven employees, while a union representing the staff fears the parent paper will soon send more workers packing.

via Canstar lays off seven – The Daily Graphic/Central Plains Herald-Leader – Manitoba, CA .

– Sources are telling WBAL News that the county executive is meeting with his cabinet today to make final changes to the budget and those will include spending cuts and layoffs.

Jack Ohman

Jack Ohman

– Among the jobs to be cut are a police officer, an employee paid out of the city’s water fund and several seasonal positions.

via Adrian City Commission OK’s layoffs – Adrian, MI – Daily Telegram.

– SACRAMENTO, Calif. — Sacramento County is sending notices to 344 probation department staffers that they may lose their jobs as part of ongoing budget cuts, a county representative said.

– Aso was one of 230 Lodi Unified employees who will lose their jobs after trustees adopted a $246 million budget that included $29 million in state-mandated cuts.

via 230 Lodi Unified workers to lose jobs | Recordnet.com.

– The Clinton Board of Education took the action at Monday’s meeting, approving the layoffs of a middle school counselor, four teacher aides and one elementary school teacher. One high school teacher’s position will be reduced to less than full-time.

US and some Canada Layoff News

-Jostens announced today that it will lay off all 185 employees in Winston-Salem over the coming months as it shuts down its yearbook printing plant here.

via Jostens to close Winston-Salem plant.

– Ratcliff said that the “vast majority” of employees at the Wallburg plant will be moved to the Greensboro plant. He declined to say how many employees would be moved to the Greensboro plant and how many people would be laid off. He also declined to say how many employees worked at the plant.

via Tyco to close plant in Wallburg, move employees to plant in Greensboro.

hospital9– IOWA CITY, Iowa – University Hospitals in Iowa City has announced it will lay off 130 employees this week.

via University Hospitals to lay off 130 — chicagotribune.com.

– A residential care facility in Calais has cut 40 positions as it prepares to be acquired by another health care provider.

via Job cuts at Calais health care facility | Mainebiz.

– SANFORD — Thirty-five workers at the Evonik Cyro plant in south Sanford were laid off today.

via Journal Tribune: York County’s Only Daily Newspaper > News > Evonik Cyro eliminates 35 jobs in Sanford.

– MONTICELLO – Approximately 60 employees at a power packaging company located here will be laid off from their jobs indefinitely, beginning Aug. 10.

via Girtz to lay off 60 in Monticello | jconline.com | Journal and Courier

– LOS INDIOS – Penske Logistics, a warehousing and shipping company, has notified state officials it may lay off 100 workers in the next 60 to 90 days, a company spokesman said.

via Penske considers laying off 100 workers | penske, state, logistics – Online Extras – Brownsville Herald.

– Lift-Tech employs around 200 workers, most of whom are union members. The company is owned by Columbus McKinnon from Amherst, New York.

via Lift-Tech in Muskegon Heights to close | wzzm13.com | Grand Rapids, MI .

– A local seat manufacturer is temporarily consolidating operations and laying off about 20 workers as it deals with its usual summer slowdown on top of the recession.

via Seat manufacturer lays off about 20 – MLive.com.

-The closure will put 263 people out of a job. While the numbers may seem small compared to the thousands of layoffs that large companies have announced, it still takes a huge chunk out of the local economy. Now, three percent of Butler County workers are on the verge of joblessness.

via Closure wipes out 3% of Butler Co. workforce – WSFA 12 News Montgomery, AL |.

boa– Bank of America has told Florida regulators that it will lay off 81 employees in Tampa.

via Bank of America to lay off 81 in Tampa – Tampa Bay Business Journal: .

delphi1– Delphi Corp. is closing its Vandalia plant this year, costing the community another 116 jobs, according to public records.

via Delphi closing Vandalia plant, slashing 116 jobs – Dayton Business Journal: .

talbots2– LAKEVILLE – Talbots has announced another big round of corporate layoffs across all locations, including nearly 100 jobs at the distribution center on Kenneth Welch Drive.

via More Talbots layoffs – Lakeville, MA – Lakeville Call.

– LINCOLN, Neb. (AP) – The University of Nebraska-Lincoln plans to eliminate 56 job positions to deal with a budget shortfall.

via University of Nebraska-Lincoln to cut 56 positions – NTV – KHGI/KWNB/WSWS-CA – Where your news comes first. – Grand Island, Kearney, Hastings, Lincoln | .

– Bishop Kearney High School is cutting 10 faculty, staff or administrator positions because of a drop in enrollment for next year.

via R News | 24 Hour Local News | TOP STORIES | Bishop Kearney to Cut 10 Positions .

– Clayton on the Park luxury apartments for seniors plans to close in August, and the project’s developer has laid off employees.

via Clayton on the Park to close, developer lays off workers – St. Louis Business Journal: .

– MERIDIAN, Miss. — Shingle maker CertainTeed Corp. has announced an indefinite shutdown of its Meridian ceiling tile plant and the lay off of 90 workers.

via CertainTeed Corp. to shut down Meridian plant – Florida AP – MiamiHerald.com.

– Newell Rubbermaid will be laying off 135 employees beginning in August at its Macedonia plant, which makes Graco children’s car seats.

via Ohio.com – Newell Rubbermaid to lay off 135 in Macedonia .

– Cooper Tire announced Wednesday that they will be shifting their plant operations to Franklin, Indiana, and will lay off 59 employees by the end of August. The company announced the closing of the Moraine plant of Dryden Road in December of 2007, but had not officially decided on a closing date until this month.

via Two More Area Businesses Lay Off Workers – WHIO Local News on newstalkradiowhio.com.

– Facing a 20 percent reduction in state funding, Southern Oregon University will go to a four-day work week for part of the summer and trim faculty and staff pay, probably through unpaid furlough days.

via SOU announces cutbacks, cost savings | MailTribune.com.

– “UC Berkeley is facing the most difficult financial situation that we have ever encountered in our university careers,” the memo said.

Campus officials had already anticipated needing to trim department budgets by 8 percent for the coming fiscal year, but will likely need to cut closer to 20 percent, according to the memo.

via Chancellor Warns of More Deep Cuts to Campus – The Daily Californian.

– Moorpark, Oxnard and Ventura colleges plan to eliminate 11 jobs, saving a total of about $832,000.

via College district to eliminate 11 jobs : Breaking : Ventura County Star .

washington-state-university– Washington State University is cutting about 360 full-time jobs and three academic programs to reduce its budget by $54 million, or more than 10 percent, over the next two years.

via Washington State University cutting 360 jobs – Puget Sound Business Journal (Seattle): .

– Officials said 500 positions will be cut, but 300 of those positions are full now. Interim UT President Jan Simek said those people will be told they need to start looking for other work.

via Chattanooga Times Free Press | Tennessee: More than 300 employed by UT to lose jobs over next two years.

cessna4– Forty people will be out of jobs at the Columbus Cessna plant.

Doug Oliver, a company spokesperson, says the employees have been told of the layoffs, in general, and will get notices this Friday.

via 40 People Will be out of Jobs at Columbus Cessna Plant | WRBL.

– Ratcliff declined to say how many people work at the Wallburg plant, but town officials estimate that the plant has about 400 employees. Ratcliff said that the “vast majority” of the employees in Wallburg will be moved to the Greensboro plant on Triad Drive. He declined to say how many people will move to the Greensboro plant and how many will be laid off.

International Layoff News

british-airways– British Airways is giving staff the option of working without pay for up to a month in order to “play their part” in what chief executive Willie Walsh describes as a “fight for survival”.

The beleaguered company says employees can opt for between one and four weeks’ unpaid work, with the salary deduction spread across between three and six months’ pay packets. Operational staff will continue to receive shift allowances, so staff will not necessarily be receiving no money at all for the period, BA said. There is also the option of up to a month’s unpaid leave.

via Struggling BA asks its 40,000 employees to work without pay – Business News, Business – The Independent.

michelin1– CLERMONT-FERRAND, France (AFP) — French tyre maker Michelin said on Wednesday it would shed 2,800 jobs through early retirement and voluntary redundancies in the next three years, sparking concern from the government.

– Deutsche Post DHL (DPWGn.DE), Europe’s biggest mail and express delivery company, is to cut up to 520 jobs, primarily at its DHL Express unit, it said on Wednesday.

– ONE of Plymouth’s largest employers, The Wrigley Company, is likely to make 50 workers redundant – because the recession has caused a decline in gum chewing.

via Wrigley may make 50 workers redundant.

– Up to 100 people are to lose their jobs at Victoria Square in Belfast following the announcement that two restaurants in the centre are to close.

via BBC NEWS | UK | Northern Ireland | 100 jobs to go at Victoria Square.

– A Hampshire company that makes forklift trucks and equipment used in warehouses has said it is cutting 350 jobs.

All manufacturing and engineering activities at the Linde plant in Basingstoke will be transferred to France and Germany.

via BBC NEWS | UK | England | Hampshire | Forklift truck firm cuts 350 jobs.

– A TOP sportswear firm is set to close its Lothian plant with the loss of around 60 jobs.

via Sportswear plant to shut down with loss of 60 jobs – Scotsman.com News .

– Luxury lingerie brand Aubade to shed 104 jobs

via FRANCE: Luxury lingerie brand Aubade to shed 104 jobs: Apparel and textile News & Comment.

– ABOUT 80 jobs face the axe at a South Tyneside supply company, it was announced today.

via 80 jobs go at Hebburn factory – Shields Gazette .

– ZURICH (Dow Jones)–Adecco SA (ADEN.VX) said Wednesday it will cut 350 jobs in France, part of cost-cutting measures meant to counter sharply lower demand for job placement services.

Hiring News and News You Can Use

– If you’re looking for a job, look no further.

Hilton Hotel Corporation is opening three new hotels in downtown Orlando, which means over 1,400 jobs!

via Hilton to offer over 1,400 jobs – WDBO Local News on wdbo.com.

– Officials say the new facility will employ 250 people over the next several years as it ramps up production volumes.

via TheVoiceNews.com: St. Clair plant to bring 250 new jobs 06/17/09.

Mike: I’m amazed at the number of call center jobs that are opening throughout US. The country is going from a manufacturing to a call center economy.

– As many as 1,500 new jobs could result from the opening of a new call center in the old Firestone Bank building on Akron’s South Main Street.

The business, PlusOne Communications, is expected to announce the hiring binge at a news conference this morning at the former bank.

via Ohio.com – New call center could bring 1,500 jobs to Akron .

– Even as it was announced that Oregon’s unemployment rate had reached a record 12.4 percent one Oregon town is adding jobs by the hundreds.

Construction is underway on a FedEx shipping hub in Troutdale that, when finished, will create 650 new jobs.

via FedEx bringing 650 jobs to Troutdale.

– State leaders announced V-Vehicle Co., or VVC, as the highly anticipated automaker that will manufacture high-mileage gasoline cars in Monroe with what developers are dubbing a transformational technology.

via 2theadvocate.com | Business | Monroe to gain 1,400 auto jobs in 15 months — Baton Rouge, LA.

– TAMPA – Defense contractor Lockheed Martin is interviewing for as 100 skilled positions in Florida during a job fair under way today at the Crowne Plaza Hotel, 5303 W. Kennedy Blvd.

via Lockheed Martin interviewing today in Tampa for 100 jobs.

– Dell Inc. will start recalling some laid-off workers at its Forsyth County plant on Monday.

via Dell to temporarily call back some laid off workers.

– Alma Products announced Tuesday it will hire back more than 70 of its laid-off workers as it begins a new expansion to rebuild transmissions for the automotive aftermarket.

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Mike: That’s it till tomorrow and the Thursday Jobless Claims report. Consensus is 610,000 jobless claims with continued record continuing claims. I’ll be also looking at the revised claims for last week to see if the 21,000 jobless claims improvement held or was revised higher as has been the case for months. Tomorrow’s call is a tough one because of the timing of all the auto layoffs, but I’ll go wild and predict a reduction of claims to 590,000. See you on Thursday……………..

Lisa Benson

Lisa Benson


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