Will the labor shortage impact Commercial Real Estate?
Job Openings Overtake People Looking for Work
- Job openings in June reached record 10M – Previous peak was 7.6M in 2018 under tight labor market
- Roughly 1.4M more jobs available than people looking for work, despite unemployment rate still at 5.4%
Labor Shortage Drag on Economic & Real Estate Recovery
- Some tenant types, like Retail, Hotels and Sr. Housing, unable to hire enough staff to operate at full capacity
- Labor shortages stifle economic growth – Slows demand for Retail, Industrial warehouses, Offices and Apartments
- Construction worker shortage could limit new supply; would benefit performance of existing real estate
Labor Imbalance Could Present New Headwinds
- Competition for talent contributing to rising wages; May further fuel inflation
- Rising inflation could force the Federal Reserve to tighten monetary policy sooner than expected
*Job openings through June; Unemployed through July
Sources: Marcus & Millichap Research Services, BLS