WASHINGTON, DC—When it comes to the economy and, subsequently, commercial real estate performance, the most important factor is always jobs. Without them, households cannot prosper, let alone form, and everything from GDP to office vacancy to collective morale suffers.
The employment situation in this country has experienced as many ups and downs as the economy, if not more. Yet if you look at the past 15 years, there's no doubt that this past recession has hit employment the hardest by a long shot.
In examining the past decade and a half, we came across several interesting data points from the US Bureau of Labor Statistics and compiled several below for your perusal. So sit back, read on and enjoy the graphics.
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These annual numbers are not unfamiliar, but taken as a group, there are some telling trends. Most distinctly, between 2000 and year-end 2014, the percentage of the population that is in the labor pool has decreased by over 4%. Meanwhile, the unemployment rate has steadily increased, with the biggest jump occurring at the market crash in 2009-2010. Despite improvement since then, unemployment has still not reached pre-recession levels. As of June 2015, unemployment was at 5.3%, with 223,000 jobs added to payrolls. That's a 20-basis-point decline from the prior month.
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After a very tough few years, things are beginning to look up in the smaller pool of those who would be defined as long-term unemployed. The level of people who looked for work for over 27 weeks peaked to a record high of 6.7 million—or 45.1% of all unemployed individuals—in the second quarter of 2010. Since then, the number has gradually declined to 2.8 million (or 31.6% of the unemployed population) as of year-end 2014.
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Laid out like this, the impact of the downturns of the past 15 years is abundantly clear. The map is relatively light in 2000 and through much of the decade. Following the recession that started in 2007, the colors of the shaded states are much darker, indicating a higher unemployment rate. There's been some improvement, but dark areas remain.
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The good news is that the most recent report from the BLS indicated that job openings are on the rise. Some 5.4 million new positions were available at the end of May, the highest since December 2000, when the agency started tracking the data.
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And if one were to take a longer look, there are some obvious areas of growth ahead. According to BLS projections, some professions in the healthcare field in particular are expected to see significant growth in jobs and wages through 2022. That makes sense, given the impact of the Affordable Care Act and the aging population.
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Other industries, such as manufacturing, are expected to lose jobs over the coming years—not exactly a surprise, given the decline of the practice in the US.
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Sule Aygoren
Aygoren oversees the editorial direction and content for ALM’s Real Estate Media Group, including Real Estate Forum and GlobeSt.com. In her tenure with ALM, she’s held roles of increasing responsibility, including Managing Editor. Aygoren has received several awards for her coverage including Best Trade Magazine Report from the National Association of Real Estate Editors and the James D. Carper Award for Young Journalists. Under her direction, Forum has received four national NAREE awards for Best Commercial Real Estate Trade Magazine.
