Exclusive Q&A: Jobs Numbers Strong, But Too Early For Conclusions
Statistics point to strong growth in employment throughout the nation and in the Bay Area. Bisnow spoke with with Cushman & Wakefield’s Northwest US research regional director Robert Sammons to make sense of the numbers.
First the highlights of Robert's research:
- San Francisco unemployment has been at around 3% since December 2015;
- 37,700 positions have been added from February 2015 to February 2016; and
- This growth should affect the office market as financial, information and professional services positions have seen sustained growth during the past 12 months.
Bisnow: Do these numbers imply fears of a slowdown in the Bay Area were overblown?
Robert Sammons: Well, the short answer is it’s too early to tell. The employment numbers are holding up thus far. The office sector (information, financial activities, and professional and business services) is up by 22,800 positions or 6%. The computer systems category within professional & business services is up by 8,100 positions or 13.2%. All of those are very healthy numbers.
Bisnow: What about the tech bubble deflating?
Robert Sammons: Layoff announcements have certainly popped up in the news lately, though we’ve looked at the WARN notices and see nothing terribly unusual yet at this point other than many of the layoffs have essentially come from tech firms.
We just have to be cognizant of a potential slowdown within tech thanks to the pullback of funding—that will likely cause additional layoffs.
Bisnow: You talked before about how the Bay Area’s rapid growth over the past few years led to a supply constraint in residential. What does that mean for the future?
Robert Sammons: The cost of living in the Bay Area could push tenants of all types to look elsewhere for growth. At this point, I don’t see it as a local recession so much as a correction. But we will be watching closely for any signs of a more serious decline in the local economy.