The finance sector gained 8,000 jobs last month, according to the Bureau of Labor Statistics, but economists expect the sector to lose jobs over the next several months as banks' layoff announcements are carried out.
Real estate, rental and leasing gained 3,000 jobs, while insurance carriers and related activities lost 700. In contrast to last month, credit intermediation and related activities, which reflects activity at commercial banks and mortgage companies, gained 6,600 jobs.
"There's been a little evidence of some better activity from home builders and a big increase in pending home sales," said Nigel Gault, chief U.S. economist with IHS Global Insight, an Englewood, Colorado-based financial and economic forecasting firm. "There might be a little more activity in the household market, but it's still pretty tentative."
Even though the numbers are positive for the sector this month, the announced job cuts by banks like Bank of America, Goldman Sachs, JPMorgan and others signal that losses will soon start to pile up. The announcements "kick in over a long period of time," Gault said, which means the sector is likely to see reductions over coming months.
"For the moment, I'm sticking with the fundamentals," he said. "We're not seeing catastrophic cutbacks in like 2008, but these are going to take place over a long period of time. Companies are pulling back in the finance sector."
The broader economy added 120,000 jobs in November and the unemployment rate fell to 8.6% from 9.1% a month earlier. While there were some employment gains, 315,000 left the workforce, which partially accounts for the lower unemployment rate.
Write to Julie Steinberg at Julier.Steinberg@dowjones.com
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