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The Current Job Numbers and Their Real Estate Impacts
The Bureau of Labor Statistics’ March report noted that total non-farm payroll employment increased by 178,000, while the unemployment rate remained at 4.3%. At the same time, net hiring for Q1 2026 was 205,000.
That was the positive news.
The not-quite-good news was that the employment growth occurred in a few sectors, with “most new roles tied to health care, dining, construction and courier services,” according to a recent Marcus & Millichap brief.
Outside of those industries? “Job additions totaled about 34,000, while some white-collar fields and the federal government reported contractions,” the Marcus & Millichap researchers said.
Additionally, while the unemployment rate remained low (and has for the past 22 months), the brief said it has been driven more by a declining labor force (due to lower international net migration) than by increased hiring.
Here’s how the labor news impacted the office and industrial sectors.
Office: Positive, Despite the Dips
The number of jobs in information and financial activities dropped by 18,000 in March, while “professional and business services firms hired only 2,000 workers,” Marcus & Millichap analysts said. However, employment in office-using industries has increased by 4% since 2019.
While such growth and office absorption suggest more demand, “the main factor affecting office use remains the shift toward hybrid and in-office schedules,” the report explained.
Industrial: Manufacturing’s Slow Growth
Manufacturing employment fell by over 300,000 workers since January 2023, even as the sector added 15,000 employees in March.
Certainly, federal policies have supported domestic manufacturing, but establishing operations is a slow, capital-intensive process. Tariffs and geopolitical issues have also meant economic uncertainty.
However, “the development of new manufacturing space has been increasing since 2021, with more than 78 million square feet under construction as of April,” Marcus & Millichap analysts commented.
- ◦Lease
- ◦Policy/Gov't
