Ongoing Robust Job Creation a Positive Signal for the Economy, Multifamily Sector
- Employment growth continues at rapid clip. Employers created 678,000 jobs in February, exceeding the 2021 monthly average of 560,000 positions. The strong opening salvo in hiring for 2022 has lowered the unemployment rate to 3.8 percent.
- Broad-based hiring fostering prodigious housing demand. Growing headcounts across multiple sectors are fostering widespread and vigorous household formations. Given a limited number of more costly single-family homes for sale, much of this new housing demand is going toward multifamily options.
- Job creation could hit headwind later in the year. The unemployed population was 6.3 million last month, 600,000 personnel above the February 2020 count of 5.7 million. The number of people who want a job but have stopped looking is also up about 1.5 million relative to the pre-pandemic tally.
- Markets improving at varied paces. The national jobs landscape is making tremendous gains, but not every metro is on the same point in the recovery timeline. As of the start of this year, multiple tertiary markets in the midwest and mountain states, as well as Atlanta, were reporting unemployment rates below their February 2020 levels.
- Upward wage pressure persisting. Lagging labor force participation prompted increases to pay last year. The employment cost index at the end of 2021 was up 4.4 percent year-over-year, well above the 2.2 percent average for the decade preceding the health crisis.
Sources: Marcus & Millichap Research Services; Bureau of Labor Statistics; CoStar Group, Inc.