Metro Job Gains Continue to Slow With Government Data Revisions

Many CRE developers closely watch job growth numbers for clues where to target. The more jobs, the more people with money. The more people with money, the more need for stores, services, and apartments.

The growth numbers come from the Bureau of Labor Statistics, one of the great public information services. However, statistical data is a process, with numbers that come in and over time get revised. The revisions are bringing an insight that metro-level job gains are slowing significantly.

“Nine of January’s top 10 job creation markets returned in February but most of these metros saw annual totals continue to decline,” wrote Chuck Ehmann, senior real estate economist at RealPage. “The total number of new jobs for February’s top 10 was 134,200 jobs fewer than last month’s combined total.” For the first time since the start of the pandemic recovery, none of the top 10 markets saw a gain of more than 100,000 jobs. Only two saw between 50,000 and 99,999 job gains. The lowest of the top ten gained less than 30,000 jobs. Thirteen markets had job losses.

The area of Houston-The Woodlands-Sugar Land, TX was the 12-month top of the job growth numbers in February at 79,800 jobs, but the total a year ago was almost twice the number. Phoenix-Mesa-Scottsdale, AZ had 52,700. It was about 10,000 more in January. Dallas-Plano-Irving, TX was at 50,600, down more than 85,000 last year. New York-White Plains, NY came in at number 4 with 47,900, “far fewer than the pre-revision six-figure gains of the past.”

Las Vegas-Henderson-Paradise, NV came in at 37,700, while Austin-Round Rock, TX was at 36,500. Miami-Miami Beach-Kendall, FL, 35,600 for the year ending in February, while the year ending January was more than 10,000 higher. Philadelphia-Camden-Wilmington, PA-NJ-DE-MD was 33,200. A year earlier, it was 84,000.

Sacramento-Roseville-Arden-Arcade, CA bucked the trend, with 30,000 this February, far ahead of the 18,100 last year. Tampa-St. Petersburg-Clearwater, FL had 29,600, almost 5,000 less than last February.

These numbers don’t explain what is happening. There are a few possibilities. One is that demographic shifts couldn’t keep growing forever and we’re seeing the tapering off. Another is that people are moving to different areas in a more disperse pattern, especially as costs of living increase and the financial advantages of some areas fall away. Also, as the jobs numbers have been part of the pandemic recovery, over time they will slow as many of the “new” jobs have been recovery of old ones.

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