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CHICAGO-A large amount of job losses in the first quarter is just another indicator that we’re now in a recession, which should have an obvious detrimental impact on both commercial real estate development and leasing activity, says Bob Bach, SVP and chief economist for Grubb & Ellis Co. According to US Bureau of Labor Statistics, Bach says, the first quarter saw 232,000 jobs lost, putting the year on par with similar periods, including the recessions of 2001, 1980 and even 1974.

However, Bach tells GlobeSt.com he tells this to put comfort in the hearts of readers, rather than fear. “Yes, I think we’re in a recession, but despite all the negativity, the first three months haven’t been all that bad,” he says. “The loss of jobs hasn’t been as much compared to the first three months in prior recessions. Some might say that I’m grasping at straws, because the data is subject to revision, but I thought people could use a little good news.”

He uses a graph to show that in the past six recessions since 1969, job loss in Q1 has been worse, especially in 1980, where more than 1% of job-holders lost employment, and in 1974, where more than 1.6% went jobless. This past quarter had less than a quarter of a percent of job loss. “This does lend credence to the view that the recession could be shallow,” Bach says.

At RealShare Philadelphia on March 31, a panel of commercial real estate experts agreed that recession times call for a pull-back of easy lending and a slowdown in development and leases. Also, readers of GlobeSt.com have indicated that they know good times aren’t a rollin’. In an ongoing poll on the Web site as of Wednesday, more than 68% of respondents believe the economy hasn’t hit bottom, with 90% saying they think we’re nowhere near a recovery.

“I don’t think we’ve hit bottom, the job losses are just starting,” Bach says. “In 2001 we had a shallow recession and saw 2.7 million payroll jobs cut that year, so this is still going to go on for some months. You also have to consider the strength of the past two recessions, the recovery cycles have been weak, the job growth didn’t pick up for more than a year afterward. Even when it comes, recovery may not be vigorous.”

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