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Slowing Employment Gains May Keep CRE Growth in Check
U.S. economic growth appears to have plenty of runway left, which may not be true of employment growth. In a new report, Transwestern CIO Tom McNearney explains that to date, office and industrial have performed well across most metros with construction balanced by absorption, but low unemployment will likely keep future performance in check.
The report notes that job openings in July outnumbered job seekers by 650,000. With workforce growth projected at only 0.6% annually through 2026, many economists deem labor the top concern in sustaining economic growth.
“Continued strong job growth, coupled with increasing wages, has fueled office and industrial real estate absorption across the country in 2018, and there remain billions in dry powder in the capital markets,” said McNearney. “Americans are benefitting from higher disposable income—particularly after tax—that has resulted in rising retail sales. This, in turn, has continued to drive the industrial sector.”
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- ◦Economy
