Some seasonal factors influenced February’s job numbers, particularly in construction, which lost 31,000 jobs due to very cold weather across most of the country. The return to the employment ranks of furloughed federal workers due to January’s partial government shutdown contributed to the lower unemployment rate in February. Both the headline unemployment rate and the U-6—the unemployment rate that includes discouraged workers who have quit looking for jobs and part-time workers seeking full-time employment—saw notable declines.
Overall, the February job report, though sluggish, comports with CBRE’s view that employment growth will slow in the first half of 2019. Still, there were some silver linings in wage growth and office-using jobs. Importantly for commercial real estate, this report does not merit a change to the outlook for Fed policy, though wage inflation at its highest levels in 10 years will give some Fed hawks cause for modest additional concern.
CBRE expects that moderate job growth will continue in the coming months and overall economic conditions should remain supportive of property market fundamentals.