How Can We Help You?

Sector and market analytics

Driven by economists and leveraged by market makers.
CRE performance across major metros and asset classes. History and forecast by CBRE.

Thought leaders abound

Depth, breadth and rigor concentrated at all levels.
Synthesizing macro factors and leading indicators into actionable national, sector and market research.

Advantage is CBRE

Perspectives, scale and connections that work.
Commercial and cultural insight aligned with intellectual capital and experience to fuel informed real estate decision-making.

Which data are right for you?

Data views and extracts by scenario and on demand.
Check out the fundamentals, capital markets, and data tools now on our one-pager.

Experience the platform

See first hand why top institutional investors, direct lenders and private equity firms are clients.
Set a time that works for you.

Leverage CBRE's 
Live, Work, Play Index.

TRY IT NOW

Econometric Advisors' blog

January Jobs Report: Strong hiring leads to greater wage growth

Feb 2, 2018, 11:50 AM by Nikhil Mohan
  • Headline: U.S. employment rose by 200,000 jobs in January, which was above the consensus expectation of 180,000. November’s downward data revision and December’s upward revision resulted in net gains that were 24,000 jobs lower than previously reported. January’s number brought the average over the past three months to 192,000 jobs. Both the unemployment rate and the labor force participation rate were unchanged for the fourth consecutive month at 4.1% and 62.7%, respectively.
  • Executive Summary: The economy started off 2018 on a strong note, with employment gains surprising on the upside. Although job growth has slowed in the past two years, it remains solid. Moreover, a tighter labor market may finally be translating into greater pay increases for workers—wages saw their greatest increase since 2009 in January. Hiring was broad-based and robust in the construction, manufacturing, food services and health care sectors, with employment continuing to trend upward.
  • Wage Inflation: Annual wage growth ticked up the most since June 2009, as average hourly earnings rose 75 cents over the year, or 2.9%, to $26.74 per hour in January. Wages were up by 9 cents for the month. January’s wage gain may at last be a sign that strong hiring and an ever-tightening labor market is finally translating into greater pay increases. Moreover, this could be yet another reason for the Fed to raise interest rates in March. While it may be too early to call this a trend, we expect wage growth will accelerate further if the unemployment rate continues to drop, thus forcing companies to pay higher wages to attract workers from a shrinking labor pool.
  • Labor Force Participation: The labor force participation rate stayed at 62.7% in January. Without an improvement in the participation rate, it will be difficult to increase the pace of hiring. The rate has remained between 62.4% and 63.1% since August 2013.
  • Job Growth Outlook: We expect the rate of gains to moderate in coming months, as employers find it difficult to fill skilled positions from the current workforce. A rise in participation would help, but growth of the labor force will be limited due to the aging population. The recently enacted $1.5 trillion tax-cut package, which includes a sharp reduction in the corporate income tax rate to 21% from 35%, is expected to provide a boost to the job market. However, gains will likely be modest given that the timing of the stimulus coincides with the economy operating almost at full capacity.
  • CRE Sector Employment:
    • Construction: Construction added a solid 36,000 jobs in January, with much of the increase among specialty trade contractors (+26,000 jobs). In the residential construction sector, 5,000 jobs were added. Overall, construction employment has increased by 226,000 over the past year.
    • Industrial: Manufacturing payrolls rose by 15,000, largely in the durable goods industries (+18,000). Manufacturing has added 186,000 jobs over the past year.
    • Retail: Retail employment increased by 15,400 in January, with clothing & accessories stores accounting for much of this increase (+15,100). General merchandise stores payrolls, which include departmental stores, declined by 2,300 in January, while building material & garden supply stores added 3,400.
    • Office: Professional & business services added 23,000 jobs in January, with much of this increase driven by administrative and waste services (+14,600). Computer system design services (+4,500) and management & technical consulting services (+4,600) were the other major drivers of office-related employment.

 

Ready to Get Started?

60 second demos.


WATCH NOW

Experience the platform.


TRY IT TODAY

Become a client.


NEXT STEPS

Global Research Tools

redirect pin user minus plus fax mobile-phone office-phone data envelope globe outlook retail close line-arrow-down solid-triangle-down facebook globe2 google hamburger line-arrow-left solid-triangle-left linkedin play-btn line-arrow-right solid-triangle-right search twitter line-arrow-up solid-triangle-up calendar globe-americas globe-apac globe-emea external-link music picture paper pictures play gallery download rss-feed vcard