IRVINE, CA-Maximus Advisors reports that just three metros have cut payrolls over the past six months, although the firm's acceleration index has lost steam over the past two months, crossing into negative territory for the first time since June and measuring the lowest level since December 2012. GlobeSt.com caught up with Peter Muoio, Ph.D., senior principal at Auction.com, whose real estate research is powered by Maximus, to discuss what how employment has impacted commercial real estate in 2013 and what lies ahead in 2014.

GlobeSt.com: As we enter the final month of 2013, what needs to happen to get 2014 started off on the right foot from a CRE standpoint?

Muoio: The single most important thing is to see a continued decline in the uncertainty level for consumers and businesses. I think a hallmark for 2013 has been that we've finally seen the level of uncertainty come down from the elevated level that it's been at since about 2008, and in our view that has been a key ingredient in what has been quarter after quarter after quarter of accelerated economic growth. From the indexes we watch, we saw a big bop up in uncertainty during the government shutdown and the debt ceiling crisis, but it came back down as that was resolved. Continued resolve in uncertainty to unleash the private sector is needed as we head into 2014.

GlobeSt.com: How significant will employment be in recovery and CRE strength in 2014?

Muoio: Employment is a key to the puzzle for CRE. You need general economic growth, but employment is a key driver for absorption. What we've seen in 2013 has been good employment growth, but what we need to see in 2014 is continued and strong employment growth. If you look at the office sector, we've been gauging how much shadow inventory was left from the recession, and subsequently the office employment growth we had that helped eat away at that inventory. Going forward, strong employment means stronger absorption of space. Another sector I'd highlight, the apartment sector, has been in phenomenal shape as a property segment. There has been great expansion, and much of the recovery came from the shift from single family to multifamily. Looking forward, we'll be watching employment growth and household formations to be the next economic drivers as homeownership is likely to taper off.

GlobeSt.com: What do you see in other sectors as related to employment?

Muoio: Clearly, employment is related to retail. Consumers spend when unemployment is coming down. There's been slow improvement in retail spending, but not enough to generate a lot of absorption of retail space. Higher wage growth and boosted consumer confidence would improve the backdrop for retail absorption, but other factors are involved like e-retail that are not just tied to an employment story but are another form of retail spending.

GlobeSt.com: In terms of jobs, can the current pace of improvement support CRE recovery?

Muoio: Getting back to the office example, the current pace will support CRE recovery, and we should see a higher level of demand for each job-created space because we have burned off most of the shadow vacant inventory; however, an accelerated pace of job growth would create stronger support for a faster recovery in real estate fundamentals.