U.S. unemployment rate data and trends: January 2014

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U.S. economy added 113,000 jobs in January. This growth number is below average, but dropped the unemployment rate 10 basis points to a recovery low of 6.6 percent. In a bright spot, unemployment for high school and college graduates is lower, however labor-force participation in this key demographic is still suppressed. Total unemployment sits at 12.7 percent, above historic norms but an improvement from December’s 13.1.

See details on the data, including demographic, geographic and industry breakdowns, in this report featuring research from the Bureau of Labor Statistics and Jones Lang LaSalle.

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U.S. unemployment rate data and trends: January 2014

  1. 1. Below-average monthly gains mask a broadening recovery U.S. employment situation: September 2013 U.S. employment situation: January 2013 Release date: October 22, 2013 Release date: February 7, 2014
  2. 2. What were January’s bright spots and challenges? Overview • • • • • • The U.S. economy added 113,000 jobs in January, representing below-average growth. The unemployment rate dropped by 10 basis points to a recovery low of 6.6 percent. Total non-farm employment is at 99.4 percent of its previous peak figure. 90.1 of the 8.7 million jobs lost during the recession have been recovered. Construction was the subsector with the highest monthly growth, while PBS led year-on-year gains. Tech remains the dominant industry for job growth, with energy at national levels. Bright spots • • • • • Source: Jones Lang LaSalle Research, Bureau of Labor Statistics Unemployment for high school and college graduates is below the official rate of 6.6 percent. Although wobbling, initial claims remain near recovery lows and below the 400,000-claim threshold for an expanding economy. Bucking the trend seen in previous months, office-using industries’ share of gains up to 30.0 percent in January. Consumer confidence is up at 80.7 points on the heels of a diversifying recovery. Geographically, growth is being seen increasingly outside of Texas and tech hubs. Challenges • • • • • Total unemployment remains above historic norms at 12.7 percent. Labor force participation for high school and college graduates, although up, is still suppressed. The public sector witnessed its largest monthly contraction in employment (-29,000 jobs) since late 2012. Office-using growth continues to be subdued, with flat information payrolls and a 2,000-job contraction in financial activities. Temporary help services continues to grow, almost at 2.8 million jobs. OVERVIEW 2
  3. 3. 150,000 0 120,000 Source: Jones Lang LaSalle Research, Bureau of Labor Statistics 75,000 160,000 113,000 280,000 274,000 237,000 202,000 201,000 199,000 203,000 164,000 149,000 214,000 203,000 225,000 197,000 161,000 150,000 243,000 226,000 196,000 164,000 141,000 110,000 88,000 221,000 183,000 200,000 96,000 122,000 106,000 88,000 110,000 300,000 243,000 226,000 220,000 360,000 360,000 400,000 96,000 100,000 121,000 250,000 Oct-10 Nov-10 Dec-11 Jan-11 Feb-11 Mar-11 Apr-11 May-11 Jun-11 Jul-11 Aug-11 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 1-month net change January posts a below-average monthly gain of 113,000 jobs; revisions show more stability in 2013 350,000 50,000 OVERVIEW 3
  4. 4. Revisions bring three-month employment growth to 462,000 jobs, as unemployment declines to 6.6 percent 600 Monthly employment change 12% Unemployment rate 10% 200 8% 0 6% -200 -400 4% -600 2% -800 -1000 2003 2004 2005 2006 2007 Source: Jones Lang LaSalle Research, Bureau of Labor Statistics 2008 2009 2010 2011 2012 2013 2014 0% OVERVIEW 4 Unemployment rate (%) One-month net change (thousands) 400
  5. 5. 75 months into the cycle, total employment is now less than 0.6 percent below prior peak levels Past recessions (40 years) 1973 1981 1990 2001 2007 102% Pre-recession employment level Recovered jobs (%) 100% 98% 96% 94% 92% 90% 0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 50 52 54 56 58 60 62 64 66 68 70 72 74 Source: Jones Lang LaSalle Research, Bureau of Labor Statistics OVERVIEW 5
  6. 6. 90.1 percent of jobs have been recovered from the recession; now 900,000 jobs below pre-recession peak Jobs lost during recession… Jobs gained during recovery… Source: Jones Lang LaSalle Research, Bureau of Labor Statistics OVERVIEW 6
  7. 7. All office-using jobs have been recovered, but are much more tech- and management-centered Office-using jobs lost during recession… Office-using jobs gained during recovery… Source: Jones Lang LaSalle Research, Bureau of Labor Statistics OVERVIEW 7
  8. 8. Construction, PBS, leisure and hospitality and manufacturing were the drivers of January’s growth… Construction 48.0 Professional and business services Construction Leisure and hospitality 36.0 Leisure and hospitality 24.0 Manufacturing PBS Manufacturing 21.0 Durable goods 15.0 Wholesale trade 13.9 Transportation and warehousing 9.9 Temporary help services 8.1 Mining and logging 7.0 Motor vehicles and parts 6.5 Nondurable goods 6.0 Other services 4.0 Health care and social assistance 1.5 Information 0.0 Financial activities -2.0 Education and health services -6.0 Retail trade Government -12.9 -29.0 -40 -20 0 20 1-month net change (thousands) Source: Jones Lang LaSalle Research, Bureau of Labor Statistics 40 60 Four subsectors were responsible for all net new jobs. OVERVIEW 8
  9. 9. What caused construction’s economy-leading gains in January? Residential building. Construction accounted for 42.6 percent of growth in January… …but represents only 4.3 percent of employment nationally Residential building Non-residential specialty contractors Non-residential specialty contractors Residential specialty contractors Heavy and civil engineering Non-residential building Heavy and civil engineering Non-residential building Residential specialty contractors All other jobs Residential building All other jobs 13.2 12.9 10.1 64.9 8.3 3.6 i Residential building represented to 11.7 percent of job growth in January… Source: Jones Lang LaSalle Research, Bureau of Labor Statistics Figures in thousands i …but is in fact the smallest component of construction, with 646,000 workers. SECTOR FOCUS 9
  10. 10. …although PBS, leisure and hospitality, retail trade and education and health dominated year-on-year gains Professional and business services 656.0 Leisure and hospitality Retail trade Education and health services 306.0 Health care and social assistance Leisure and hospitality Education and health Manufacturing 316.0 PBS Retail trade 433.0 Financial activities All other jobs 284.6 Temporary help services 228.7 Construction 179.0 Wholesale trade 95.5 Manufacturing 93.0 Durable goods 84.0 Transportation and warehousing 81.2 Financial activities 65.0 Motor vehicles and parts 46.8 Mining and logging 36.0 Other services 26.0 Nondurable goods 9.0 Information 6.0 Government-53.0 -100 0 100 200 300 400 500 12-month net change (thousands) Source: Jones Lang LaSalle Research, Bureau of Labor Statistics 600 700 Core subsectors added 83.5 percent of all jobs over the past 12 months. OVERVIEW 10
  11. 11. Goods-producing employment jumps after slight contraction in December; service-providing slows Goods-producing 600 Service-providing One-month net change (thousands) 400 200 0 -200 -400 -600 -800 -1000 2008 2009 2010 Source: Jones Lang LaSalle Research, Bureau of Labor Statistics 2011 2012 2013 2014 BRIGHT SPOT 11
  12. 12. Both high school and college graduate unemployment below the national average Bachelor's degree and higher High school graduates, no college 12 6.5% 10 8 6 4 2 0 3.2% 2001 2002 2003 2004 2005 Source: Jones Lang LaSalle Research, Bureau of Labor Statistics 2006 2007 2008 2009 2010 2011 2012 2013 2014 BRIGHT SPOT 12
  13. 13. Tech still leading, while energy, mining and utilities growing, but at national rates of growth High-tech Energy, Mining, and Utilities Office-using industries Total non-farm 7.0 5.0 12-month % change 3.0 1.0 -1.0 -3.0 -5.0 -7.0 -9.0 -11.0 2008 2009 2010 2011 2012 Source: Jones Lang LaSalle Research, Moody’s. Note: Due to data lags, high-tech employment only available through December 2013. 2013 OVERVIEW 13
  14. 14. Tech is up near recovery norms again after seeing slowdown in recent months Year-on-year percent growth Source: Jones Lang LaSalle Research, Bureau of Labor Statistics BRIGHT SPOT 14
  15. 15. Initial unemployment insurance claims hovering between 330,000 and 350,000 since late 2013 Initial claims 4-week moving average 650,000 600,000 550,000 500,000 450,000 400,000 350,000 4 week moving average below 400,000 claims (consistently) means economy is adding jobs 300,000 250,000 Mar-08 Mar-09 Source: Jones Lang LaSalle Research, U.S. Department of Labor Mar-10 Mar-11 Mar-12 Mar-13 BRIGHT SPOT 15
  16. 16. While the recovery is broadening, slightly stronger growth boosted office-using industries’ share of gains Source: Jones Lang LaSalle Research, Bureau of Labor Statistics BRIGHT SPOT 16
  17. 17. In line with a drop in unemployment, the consumer confidence index increased to 80.7 points in January 100 12% Consumer confidence index Unemployment rate 90 10% 80 70 8% 60 6% 50 40 4% 30 20 2% 10 0 2008 2009 2010 2011 Source: Jones Lang LaSalle Research, Conference Board, Bureau of Labor Statistics 2012 2013 2014 0% BRIGHT SPOT 17
  18. 18. Growth is registering in geographies outside of Texas and tech hubs Seattle 2.6% Silicon Valley 3.4% Charlotte 2.6% Phoenix 2.5% Atlanta 2.5% Austin 2.8% Source: Jones Lang LaSalle Research, Bureau of Labor Statistics Houston 3.0% BRIGHT SPOT 18
  19. 19. Although total unemployment fell by 60 basis points to 12.7 percent, it remains above average Total unemployment U-6 10-year average 18% 16% 14% 12% 10% 8% 6% 2002 2003 2004 2005 2006 Source: Jones Lang LaSalle Research, Bureau of Labor Statistics 2007 2008 2009 2010 2011 2012 2013 2014 CHALLENGE 19
  20. 20. Labor force participation across educational attainment increases, but still suppressed 79 College graduates 78 62 77 61 76 60 75 74 59 73 High school graduates College graduates 63 High school grads no college 58 Jan07 Jan08 Jan09 Source: Jones Lang LaSalle Research, Bureau of Labor Statistics Jan10 Jan11 Jan12 Jan13 Jan14 CHALLENGE 20
  21. 21. Public sector witnesses largest contraction since late 2012, while private sector growth below historic norms Private sector hiring up 4.5 million since December 2011 Change in '000s jobs 400 200 0 -200 Public sector shed 112,000 workers since November 2011 -400 -600 -800 -1,000 2008 2009 2010 Source: Jones Lang LaSalle Research, Bureau of Labor Statistics 2011 2012 2013 2014 CHALLENGE 21
  22. 22. Information gains no jobs in January, while financial activities contracts by 2,000 Information Professional and business services Financial activities 150 100 50 0 -50 -100 -150 PBS represented 75.0 percent of office jobs lost in February 2010. In January 2013, it represented all net new office-using jobs. -200 -250 -300 2009 2010 Source: Jones Lang LaSalle Research, Bureau of Labor Statistics 2011 2012 2013 2014 CHALLENGE 22
  23. 23. Online help wanted ads fall by 56,800 in January despite a decrease in unemployment 6,000,000 12.0% New help wanted ads Unemployment rate 4,000,000 8.0% 3,000,000 6.0% 2,000,000 4.0% 2.0% 0 0.0% 2008 2009 Source: Jones Lang LaSalle Research, Conference Board 2010 2011 2012 2013 2014 Unemployment rate 10.0% 1,000,000 Online help wanted ads 5,000,000 CHALLENGE 23
  24. 24. A slight slowdown in monthly growth keeps temporary help services just under 2.8 million jobs Temporary employment monthly net change Temporary employment 60 Monthly net change in jobs (ths) 3,000 2,800 40 2,600 2,400 20 2,200 0 2,000 -20 1,800 -40 Temporary employment (ths) 80 1,600 -60 1,400 -80 1,200 -100 2009 2010 Source: Jones Lang LaSalle Research, Bureau of Labor Statistics 2011 2012 2013 2014 1,000 CHALLENGE 24
  25. 25. Midwestern and East Coast markets still lag the rest of the country Detroit 0.8% Milwaukee 0.6% Cleveland -0.6% New Jersey 0.3% St. Louis 0.6% Source: Jones Lang LaSalle Research, Bureau of Labor Statistics CHALLENGE 25
  26. 26. For more information, please contact: Ben Breslau Managing Director - Americas Research Benjamin.Breslau@am.jll.com John Sikaitis Managing Director - Office and Local Markets Research John.Sikaitis@am.jll.com Phil Ryan Research Analyst Phil.Ryan@am.jll.com ©2014 Jones Lang LaSalle Research IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.
  27. 27. In addition to unemployment reports, we regularly publish research on economic and other factors that impact commercial real estate. >> See all research

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